Private equity firm D1 Capital Partners has led a $1bn investment round into Kraken Technologies, the energy software arm of Octopus Energy Group, being spun out of the UK-based clean energy group as an independent company at a valuation of $8.65bn.
The transaction marks Kraken’s first standalone funding round and paves the way for its formal demerger from Octopus Energy. Alongside D1 Capital Partners, the round attracted new institutional investors including Ontario Teachers’ Pension Plan Board, through its Teachers’ Venture Growth platform, Fidelity International and Durable Capital Partners.
As part of the deal, new and existing investors acquired approximately $1bn of Kraken equity, providing growth capital for both Kraken and Octopus Energy. Investors led by Octopus Capital also committed an additional $320m directly into Octopus Energy Group to support innovation and expansion. Following the demerger, Octopus will retain a 13.7% minority stake in Kraken.
Founded within Octopus Energy, Kraken has evolved into a global utility operating system powered by artificial intelligence, providing billing, customer service and grid management technology to energy providers. The platform is now contracted to support more than 70 million customer accounts worldwide through licensing agreements with major utilities.
Kraken reported contracted annual revenues exceeding $500m in September 2025, representing a fourfold increase over the past three years. The business processes more than 15 billion data points per day and serves clients including EDF Energy, E.ON Next, National Grid and Tokyo Gas.
D1 Capital Partners’ investment underscores growing private equity interest in scaled energy transition technology platforms with recurring revenues and global customer bases. Founded by Dan Sundheim, D1 manages capital across public and private markets and has been an increasingly active investor in late-stage technology and infrastructure-adjacent assets.
Sundheim said Kraken’s customer retention, growth profile and leadership team were key attractions, highlighting the opportunity to modernise utility operations globally as energy systems undergo structural change.
The demerger will see Kraken operate with a separate ownership structure, independent governance and its own management team, allowing it to position itself as a neutral technology provider to utilities worldwide. Octopus Energy Group will meanwhile focus on expanding its retail energy, generation and clean technology businesses, including electric vehicle leasing and heat pump manufacturing.
Financial terms beyond the headline valuation have not been disclosed.
