Octopus Group results for FY21-22

Octopus Group, a group of entrepreneurs and investors backing the people, ideas and industries that will change the world, today announces its results for the financial year 2021-2022, which ended on April 2022, and wider activity across the Group during 2022.

The Group, which was founded in 2000 by Simon Rogerson, Chris Hulatt and Guy Myles, is a privately-owned company and has not previously communicated its financial results. Since its inception as a retail investment business, the Group has grown into one of the most disruptive and progressive companies across the financial services, energy, and education sectors.

Simon Rogerson, founder and Group CEO, said: “Octopus has come a long way since we founded the company at the turn of the millennium, using the Yellow Pages to raise the £2.25 million we needed to start the business and operating out of a small office above Costcutter in Farringdon. We’re quite different to many companies, largely because we’re entrepreneurs as well as investors. This means that we apply our own expertise as well as our clients’ money to building a brighter future.

“We’re also a private company. We don’t think it would suit our entrepreneurial nature or our approach to business – as a B Corp we think about the interests of all our stakeholders, not just our shareholders, in every decision we make – to be a public company. But being private doesn’t have to mean being secret and we want to help people to understand a bit more about our group of companies through reporting on our progress and performance.”

Group companies’ performance

In 2022, Octopus Investments, a fund management business which incorporates Octopus Ventures and Octopus Real Estate, continued its focus on putting its customers first and investing in opportunities that help to make the world a better place. This approach drove the financial success of the Group in FY21-22, with Octopus Investments posting a £92.7 million profit, representing a 98% increase year-on-year; and £268.7 million turnover, an increase of 41% on the previous year. It also increased its funds under management from £10.1 billion to £10.3 billion and grew its retail and institutional investor base from 80,000 to 89,000.

Among its key achievements during 2022, Octopus Investments launched its first new Venture Capital Trust – the Octopus Future Generations VCT – in over a decade; launched its Octopus Sustainable Infrastructure Fund, with the UK Infrastructure Bank as a cornerstone investor, to invest in a new generation of infrastructure companies helping to solve climate change; launched an affordable housing fund to accelerate the much-needed delivery of affordable homes in the UK; and was named the most active Series A and B venture capital investor in Europe¹.

Between 2018 and 2021, the Group began expanding its financial services businesses beyond Octopus Investments, establishing Octopus Australia and Octopus Wealth and acquiring Octopus MoneyCoach (previously called Hatch) and Seccl. During FY21-22, these financial services businesses had very successful years, with all delivering positive turnover growth and significant headcount growth. While all delivered net operating losses, the businesses benefit from the Group’s private ownership structure, which allows it to take a long-term view and to continue investing in the growth of new businesses during their start-up and expansion phases.

Highlights in 2022 for the financial services businesses included:

• Octopus Australia launched Desert Springs Octopus, a joint venture with indigenous communities to open up renewable energy, agriculture and other infrastructure opportunities across three million square kilometres in Northern Australia – a potential AUD$50 billion investment opportunity over the next decade
• Octopus Wealth doubled its client base and reached £1 million in annual recurring revenue
• Octopus MoneyCoach recorded 206% growth in monthly client sign-ups, with 5x more workplaces signing up to its financial coaching service every month
• Seccl achieved 307% year-on-year growth in monthly net flows, making it the fastest-growing platform technology provider in the market

Octopus Energy, a green energy pioneer, continued its relentless focus on customer service, finding innovative and meaningful ways to support its customers, and was named Which? Recommended Provider for the fifth year in a row in 2022 (and now sixth at time of writing, in 2023), remaining the most awarded energy company in the UK, and maintaining best-in-class Trustpilot ratings despite the energy crisis. During FY21-22, it doubled its revenues from £2.0 billion to £4.2 billion. It recorded a £161 million net operating loss, due to the decision to absorb £150m of wholesale cost increases on behalf of customers by charging below the price cap.

During 2022, Octopus Capital – the legal entity for the Group – demerged its shareholding in Octopus Energy from the rest of the Group. The success of Octopus Energy, combined with its independent management team, meant that the Group had outgrown its ability to fund the business on its own. The Group continues to own a stake in Octopus Energy, which is held in a legal entity called Octopus Energy Holdings Limited.

Aurora, the UK’s sixth largest provider of education, care and support services for children and young people with special educational needs and disabilities, sustained its focus on positively transforming the lives of students with autism and other disabilities through innovative, high-quality education. In FY21-22, Aurora recorded a £12.7 million operating profit, a year-on-year increase of 359%, and turnover of £51.1 million, an increase of 38%. In 2022 it also opened three new day schools, in Gloucestershire, Cambridgeshire and Surrey.

Simon added: “For the last few years, we’ve focused our efforts, and our investments, on the three areas where we think we can make the biggest impact. Whether we’re backing entrepreneurs, or building our own businesses, our efforts have been focused on building a more sustainable planet, empowering people and revitalising healthcare. Our planet is deteriorating, global inequality is increasing, and mental health is a bigger problem today than ever before. The solutions to these problems won’t come from charities or governments. They’ll come from businesses. Specifically, from entrepreneurs, society’s true agents of change. 

“Across all Octopus companies we want to illustrate the power of business as a force for good, and to inspire the companies we invest in to become partners in our vision for the future. To demonstrate our commitment, we are planning to invest £50 billion in the people, ideas and industries that will change the world, by 2030.

“And to us, this doesn’t only rest on what we do. How we behave is just as important. Rather than channelling our focus to outsmarting, outpricing, or outmanoeuvring the competition, we’ve developed an alternative strategy. We focus on out-behaviour. This out-behaviour comes from building an organisation where people instinctively do the right thing, even when no one is watching. It’s a simple idea that ripples through everything we do.

2023 will see Octopus expand its existing businesses far beyond where they are today, yet constantly focused on solving some of the world’s biggest problems. While this is list is far from exhaustive, I expect we will build or invest into businesses focused on solving the financial illiteracy problem in the UK, building schools where the syllabus is focused as much on life skills as traditional education, reimagining death, the electrification of transport and connecting the UK to a superfast broadband network.”

Ends

Notes to editors

1. https://news.crunchbase.com/venture/europe-leading-2022-investors-crowdcube-antler/

For journalists in their professional capacity only. Issued by Octopus Group February 2023.