Our Founder, Hubert Nomamiukor organised a Q&A session with Greg Jackson, the CEO of Octopus Energy, to capture his entrepreneurial journey, influences and perspectives. For those that don't know Octopus Energy, they are UK's fastest growing green energy retailer and are currently valued at $2 billion.
Hello Greg, and thank you for taking the time our to participate in this interview. You have cofounded a number of companies over the last 20 plus years, so it’s fair to say you are a serial entrepreneur. Please talk us through your entrepreneurial journey from when you graduated Cambridge University in 1994 to when you cofounded Octopus Energy in 2015?
Greg: Believe it or not, I dropped out of school at 16 to start creating video games before eventually going to Cambridge University. After graduating I joined Procter & Gamble and went through management training, owned and turned around a number of small ventures, and I even managed a factory that made and sold Mirrors at one point. More recently in my work history I’ve specialised in creating technology & ecommerce platforms, something me and Octopus Energy CTO James Eddison did together for clients such as Greene King and SAP. We then realised the change within the energy industry we could enable with a strong technology platform underpinning us, and that’s how Octopus Energy came about. I also have had non-executive and chairman roles at peer-to-peer lender Zopa and Consultant Connect.
Do you have any influences that have inspired your entrepreneurial journey and how?
Greg: It might be a bit cliché, but i definitely admire what Elon Musk has done. Elon has the vision and reach to be able to disrupt so many industries for the better, and I believe we have similar approaches in disrupting industries to help save the planet. People thought electric vehicles wouldn’t take off but look at Tesla now. We are doing the same thing in clean, green energy. You also cannot deny the sheer will and determination of Jeff Bezos, and how he has managed to create not only the world’s largest online shopping and delivery site, but also revolutionise cloud computing via AWS, something we have made huge use of with our business.
A lot of people have different views of what it means to be an entrepreneur and if this is different from being a businessman or woman. In your view what does it mean to be an entrepreneur and are all entrepreneurs businessmen or women?
Greg: I prefer the term business leader to entrepreneur, and they can come in all shapes and sizes.
A business leader is someone who doesn’t look to make quick money, but really wants to change their industry for the better, do something different and lead from the front, rather than worry about what their competitors are doing.
What defines a successful entrepreneur? Is it profit, value or something else?
Greg: Don’t get me wrong, profit and value are incredibly important to a company’s life-cycle, but happiness should be put above all else. Are you happy doing what you’re doing? Are people working at your company happy? We’ve established an incredibly flat structure here at Octopus, which allows people to make roles their own, and find what really works for them to make them happy to come to work every day.
How much of your upbringing, surroundings and environment influenced your entrepreneurial journey?
Greg: My upbringing had a huge effect on me wanting to start Octopus Energy. My mother was a single mother and was working class, and despite working to put food on the table, I remember vividly that sometimes we didn’t have enough money to keep the lights on. My mum was hit with huge bills for electricity and struggled to pay them, and after experiencing my bills jump frequently when I was paying them myself as an adult, I knew that something had to be done to change this. This is why customers will always be treated fairly and with respect at Octopus Energy, and that we won’t pump up prices after you’ve been with us for a year.
What would you say is the most important trait of a successful entrepreneurs?
Greg: I have a strong desire for my colleagues to be successful. I don’t just want them to come in and do things for the company. I want them to feel happy and fulfilled by the work they do. I want them to know that their work is making a difference, everyday. And I genuinely hope they all go on to great things, even if that’s not necessarily at Octopus Energy.
If you could do it all over again what would you do differently in your entrepreneurial journey?
Greg: If I could change anything I would have trusted myself more, as I could have started Octopus Energy five years earlier than I did! Aside from that, every experience has helped in some way or another, and been a vital lesson to learn to get me where I am today.
What advice do you have for aspiring entrepreneurs?
Greg: There will always be stressful moments that push the boundaries of your mental wellbeing when you are a founder, so any aspiring entrepreneur needs to be acutely aware of their own resilience and mental health.
How would you define a successful business leader?
Greg: Success is different for everybody, and you need to be honest with yourself about what would make your job a success, is it happiness? Profit? Growth? You need to ask yourself these questions when defining your success.
What would you say are the most important traits business leaders should possess to be successful?
Greg: The desire for their colleagues to be happy and successful.
What is the number one trait you look for in employees before recruiting them as part your team, and how has this requirement been integrated into the organisation’s culture and recruitment policy?
Greg: When I meet all of our new starters - which I always make sure to do during introductory training - the ones that stand out to me are the ones that ask themselves what they can do for the company, rather than what the company can do for them, they look at their own skills and wants, see what they can bring to the table and do their best.
I read an article recently where you said Octopus Energy don’t have a HR department. What inspired this leadership technique and what are the pros and cons of Octopus Energy not having a HR department?
Greg: Octopus is unusual. We scaled the business by repeatedly cloning micro businesses, and what works for us won’t work for other businesses. HR in all companies will be looking for how they can improve value to businesses, and there are always conversations to be had about alternative models from which we can all learn. We train our managers to take on many of the functions that are normally covered by HR departments. In our experience this leads to strong relationships between managers and team members, happier employees and higher productivity. I learned a big chunk of what I know from a brilliant HR Director, Dennis Shuler at Procter & Gamble, who was a massive advocate of decentralisation and people centred management. Octopus's approach is certainly not for everyone.
There is growing evidence that diverse workforces are more productive than non-diverse workforces. What’s your take on this concept and how diverse is your leadership ranks in Octopus Energy?
Greg: While we can’t change who our founders are, our leadership team is made up of 50% women, with BAME, LGBT+ and working class representation throughout. Our middle management team in operations - which makes up most of our team - fares even better, being made up of 80% women and most of them have been with us from the first 50 employees we hired, showing that people are happy here and like to stay. Diversity is extremely important during our hiring process, and we anonymise CVs so that we can hire for the people behind the name and profile.
Our researched showed that Octopus Energy has grown its domestic customer based in UK, from just 198,000 customers in 2018 to over 1.5 million customers in 2020. That’s an amazing 658% growth in your domestic customer based alone, and within the span of 2 years. You are also expanding globally into Australia and Japan, making you one of the fastest growing green energy companies globally. What is the secret behind the growth and success of Octopus Energy?
Greg: Passionate young people who believe in our mission. Our team is made up of climate enthusiasts who know that switching people to green energy and growing that customer base around the world is the number one thing we can do to turn the tide on climate change. We also create industry leading technology that allows relentless efficiency and world class customer service, enabling us to retain our customers and keep them happy.
Octopus Energy has a multi faceted business model, generating value from different revenue streams. Please talk us through your operating business model, how it generates value and how this gives you a competitive edge in the retail energy market?
Greg: Our proprietary technology platform, Kraken, enables our operating model and efficient customer service. This platform was created 50/50 by our tech team and our customer service team, and is worked on and tweaked constantly to create the best process for the team who are looking after customers. It has enabled us to lower our costs to serve up to 75% compared to some of our competitors Thanks to Kraken, we are able to scale our customer service team quickly to take on new customers and keep them happy. We are also able to license out Kraken to other energy companies, allowing them to make use of the same efficiencies. We have already done this in countries like Australia, Germany, US, New Zealand and Japan, so we still have many more countries that could benefit from this technology and our business model. By expanding to so many other countries and really capitalising on the technology we create, we are able to have an edge on the competition. By expanding to so many other countries and really capitalising on the technology we create, we are able to have an edge on the competition.
Octopus Energy is currently value at $2 billion, how did this evaluation come about?
Greg: We’ve been rapidly growing and in December closed our second financing round with Tokyo Gas and Origin Energy in 2020, which increased our valuation to more than $2 billion.
In regards to your global expansion plans, Octopus Energy is currently located in three continents, do you have any plans of expanding into Africa or acquiring any green energy businesses in Africa?
Greg: No country is off limits to Octopus Energy, we aim to bring cheaper, greener energy and world-class customer service to many people all over the world. We have an aim to reach over 100 million customers by 2027, whether that’s via other companies licensing Kraken or customers joining Octopus Energy, so we never say never for any country or continent, even if we don’t have any plans to at the moment.
The last 12 months has been tough on a lot of businesses due to the COVID 19 pandemic. What impact has the pandemic had on Octopus Energy and how have they navigated this?
Greg: The pandemic certainly hasn’t slowed us down. As a company we are completely digital, so we asked everybody to take their laptops home on Friday, and when lockdown was announced on Monday, our team just plugged the headsets into their laptops and continued working as usual. Our customer service metrics actually improved during the pandemic, and we were the only large domestic energy supplier in the UK still answering calls as usual.
In regards to your global expansion plans, Octopus Energy is currently located in three continents, do you have any plans of expanding into Africa or acquiring any green energy businesses in Africa?
Greg: No country is off limits to Octopus Energy, we aim to bring cheaper, greener energy and world-class customer service to many people all over the world. We have an aim to reach over 100 million customers by 2027, whether that’s via other companies licensing Kraken or customers joining Octopus Energy, so we never say never for any country or continent, even if we don’t have any plans to at the moment.
Our last question before ending this interview is around environmentally sustainable businesses and their impact on climate change. Octopus Energy is a green energy company and one of the leaders when it comes to environmentally sustainable practices. What advice do you have for other businesses on environmental sustainability and its impact on climate change?
Greg: Switch to green energy! It is the easiest and most impactful way to start your journey in greening up your business. We have business customers who started with green electricity, and now have solar panels, batteries and all manner of things to help them be more conscious of their environmental impact.