The UK business secretary, Peter Kyle, has said he is “betting big” and “picking winners” as the government takes direct stakes in growing businesses to boost economic growth.
Speaking at the World Economic Forum in Davos, where he and the chancellor, Rachel Reeves, have been talking up Britain’s prospects, Kyle said ministers were taking an “activist” approach to industrial policy.
Yep, he is.
He highlighted the recent decision to allow the £26bn state-owned British Business Bank to buy equity stakes in companies, including the announcement last week of a £25m investment in the energy supplier Octopus’s software spin-off, Kraken.
“The most potential in our economy, in the short and medium term, is scale-up companies,” Kyle said. “I was at Octopus yesterday. They’re now employing 1,500 people in their head office in London alone.
“We can find other companies that are on that kind of trajectory and we can expedite their growth. Then it will create thousands of new jobs, and it will create enormous amounts of wealth, which will recycle through the economy in a really fast way.”
Spray it all right up the wall.
There’s a vast PE and VC indistry already scouring the economy for those things. What makes anyone think that government – moving slower, with weaker incentives – is going to find hidden gems?
Kraken’s valuation (by who) is $8.65bn. We presume US not Zim. £25m sure sounds like betting the farm.
The valuation is simply that private investors buy a bit of it, so the rest gets extrapolated.
It sounds like an absolute dog. Not a bad company, but a bad investment.
Launched within Octopus Energy Group, Kraken’s AI‑powered operating system is now contracted to serve over 70 million accounts worldwide through licensing agreements with major utilities.
AI-powered operating system yells bonfire of cash to me. This probably just means “has a chatbot”.
Kraken announced in September that its contracted annual revenue exceeded $500 million – growing 4x in just three years.
The demerger enables Kraken to operate as a fully independent technology platform for utilities worldwide, accelerating global adoption and deepening partnerships, while allowing Octopus Energy Group to focus on scaling its consumer, generation, and clean technology businesses.
But if it’s making this sort of stunning growth, why are you only keeping 14% of it? Are Octopus just handing out free blowjobs, or is it more likely like that the sales guys are struggling to get new customers, so float it off?
Michael always assuming i detected /s correctly. It’s the 26 billion in the State bank that’s at risk. The 25million is an example that the minister is bragging about this week. These are politicians and civil servants playing in investments, and what’s the only rationale? It’s that no one else would touch’em? Utter ludicrousness! As a cherry topper, as Steve reports, the final investment green light is coming from someone that lists saying “there there keep your chin up” to traumatised Bosnians on his CV! Every single interview and MQ and surgery this guy shows up to for the next 40 years he should be asked how is our 26 billion is doing over and above the cost of borrowing the 26 billion?.
Peter Kyle is a fucking retard:
By the age of 25, he was accepted on his third attempt to become a student at the University of Sussex, where he gained a degree in geography, international development, and environmental studies, and later a doctorate in community development.[1]
After university, Kyle worked as an aid worker and as a project director for the charity Children on the Edge in Eastern Europe and the Balkans helping young people whose lives had been affected by the political instability created by the Bosnian War and Kosovan War, helping to establish an orphanage in Romania.[2][3][4]
An idiot, with an idiot’s education and experience.
Is your point that he’s stupid enough to believe his own twaddle?
It does read like a description of one of the tens of thousands of people working in our public sector who are guilty of treason, and continue to commit it daily.
With an academic pedigree like that it’s surprising he didn’t become a climate “scientist”.
That’s all us Spurs fans needed, the labour government ‘investing’ in one of our sponsors. Oh, no panic over, it’s a different ‘Kraken’……….
In Britain an “activist” approach is always taken by every poltician, because in the UK an “activist” can do what they like and never suffer the consequences. So you can wreck property, cause old ladies to die and generally cause chaos and the law rewards you with coffeee and sandwiches. Politicians can lie to get into power, bankrupt the country and reduce is to a medieval caliphate and still live in a chauffeur driven life of luxury unaffected by your decisions…
Not only politicians but also the perma-government – aka the civil service.
Exactly that.
Which is why I grind my teeth so often when Beeboids introduce with clear approval some random annoyance as an “activist”.
Funny how there are apparently zero “activists” on the Right, innit?
Those on the right generally have jobs that aren’t shouting into a megaphone at today’s protest.
Thing is, activists are selfless, passionate and caring, which is why they give up their time and devote themselves to these fabulously worthy causes unlike callous, money-grubbing capitalists and the slumbering lumpenproletariat.
Hey, thats not me! Or rather it must be a new Jim to these parts.
Or a Jim new to these parts.
And the lesson is: don’t watch Beeboids.
I thought “picking winners” was usually used as a pejorative. He actually meant that seriously?
The Left have been trying to reclaim it as a good thing for some time; see this from 13 years ago, where they not only claim governments can and should ‘pick winners’ but even use British Leyland as an example!
https://www.civitas.org.uk/pdf/PickingWinners
Yes, the Japanese protected their industry but in truth, American cars were worse value anyway. It’s why Toyota eventually curbstomped GM. Not because of Japan or the USA but because the rest of the world eventually twigged how much better they are. Do you see any African warlords with GMCs and Buicks? No, because they’re shit compared to a Hilux or Land Cruiser.
And no, the failure of BL wasn’t investment. It was that it made shit cars and had shitty dealerships. Yeah, the Metro sold a lot, but almost everyone hated them, hated getting them serviced. They bought one and switched to a Renault 5 or VW Polo next time.
Nor did government support help brands like Mini and Land Rover. They’re just iconic brands.
The intervention of Mrs Thatch wasn’t really picking winners, it was just correcting for costs. Some industries can work in a number of countries, so add sweeteners to bring them here. Same as how we have tax cuts for movie making. You’re in more competition for that work,
He got into the University of Sussex on his 3rd attempt to study geography (retards looking at maps), so probably doesn’t know.
We should probably stop letting idiot losers make our laws.
Well there does seem some correlation between the numbers of university grads in government & commerce & how poorly the country & its economy has performed. Possibly true of the US, as well.
You may have a point about commerce, but not government. Cabinets and the civil service have been dominated by university graduates since the mid-19thC. However, since the abolition of the grammar schools (1965) – an act of stupendous cultural self-harm! – educational standards have fallen. Correspongingly, university entrance standards have also declined and courses made less demanding. Worse still, universities now discriminate against applicants from independent schools.
Meanwhile, 92% (23 out of 25) of the present cabinet were educated at comprehensive schools, a historic high. And only 4% (1 person) of the Cabinet was privately educated – the lowest percentage since 1945. I rest my case…
You got stats for that, Theo, or just presuming it?
Before the sixties the number of MP’s going strait from uni into politics approached zero. Almost all MP’s had a history of having a proper job before entering politics.
I keep saying, ban anyone under 50 from standing as an MP. Make the power hungry narcissists go and do something else for 30 years before they can even consider the greasy pole to power. That should take the wind out of their sales a bit. Chances are people like Blair/Brown/Cameron etc would never have been in politics if they’d had to have proper careers first.
That won’t work, Jim. They’ll just spend that time in “charities”, NGOs, unions, and the transnational organisations, or the public sector, or law, or both, like Starmer, playing politics without having to be elected. In none of these places will their bubbles be burst.
Starmer’s an excellent example, isn’t he? His father would probably make a better MP if not Prime Minister.
Yes they’d try. But 30+ years is a long time to wait to even start standing for Parliament. As it is you can get the candidacy for an unwinnable seat in your 20s. A winnable one in your 30s. In the case of Blair, PM by early 40s. In my world he’s not making PM until he’s 60+. I think by then life may have beaten a bit of sense into him, if he even managed to make it that far. My guess would be that such people would off being masters of the universe somewhere else by age 50, and wouldn’t want to give it up to start again at the bottom of the political ladder. Thus keeping them out of politics entirely.
I think by then life may have beaten a bit of sense into him, if he even managed to make it that far.
It hasn’t yet, Jim, but it’s awarded his bank balance. And that of his obnoxious, grifting wife.
“ban anyone under 50 from standing as an MP”
My solution is to stop paying MPs a salary, but instead compensate them for lost earnings, based on the average of their previous ten (doesn’t have to be ten, pick a number) years’ incomes.
That way they get bugger all if they go straight into politics, but lots of money if they’ve had a decent job or business.
Yes, still the problem of the people who ‘work’ in unions, NGOs, etc.; difficult to eradicate that. But those jobs don’t pay very well, except at the top end, so hanging on for promotion or looking for a better job elsewhere will mostly be better than effectively freezing your salary at a junior’s low level by becoming an MP too soon.
The people have a choice. I would never vote for one of these kids standing for office.
I am talking about British Cabinets and the senior civil service; you are talking about MPs going into politics straight from university. There’s hard data for the former; but little for the latter.
In the period 1850-1910, Cabinets and senior civil servants were overwhelmingly dominated by Oxbridge graduates. From 1850-1910, university-educated MPs initially dominated the mid-19thC. Many being second sons of peers or simply gentry had not ‘worked’ before entering Parliament
Later, the period saw a gradual increase in the number of working-class and trade union-backed candidates, especially leading up to the 1906 and 1910 elections.
The Civil Service’s performance can be adequatly explained by the erudite CN Parkinson. But politicians. My attitude to university graduates, is like plumbers & electricians – but not necessarily up to their standards – they have acquired a toolkit & are menials one employs when absolutely necessary. They may be intelligent by their own rather self referential standards but that doesn’t guarantee they’re smart. And it’s smartness that seems to have been absent from your political class for some considerable time. In the current crop, it’s virtually undetectable.
Your explanation?
Let’s ignore the Labour Party & the LimpDims who would be intellectually challenged by pond slime. The Tory Party. They should have sussed which way the wind was starting to blow a decade ago. But they stumbled blithely on until the electorate unceremoniously dumped them. That’s smart?
Civil Service behaviour requires a deeper analysis than Parkinson provides, because it is the permanent government…
Britain’s high point in the world,1815-1925(?), occurred when Oxbridge graduates were largely in control, administratively and politically. As entry to the UK’s governmental elites became easier, and university entrance standards were steadily lowered, the UK declined….Your explanation?
Well there certainly weren’t sufficient Oxbridge grads to fill all 650 odd parliamentary seats & the Civil Service.
But sure, many of the leading political lights of the period went to Oxbridge. Is it surprising? Many of them were from the families have been providing England’s government for centuries. They seem to have treated universities as much as social clubs as places of education. I give your this Prime Minister seems fun:
Archibald Primrose (Lord Dalmeny) – 5th Earl of Rosebury. PM March 1894 – June 1895
During his time at Oxford he was a member of the Bullingdon Club.He left Oxford in 1868: Dalmeny bought a horse named Ladas, although a rule banned undergraduates from owning horses When he was found out, he was offered a choice: to sell the horse or to give up his studies. He chose the latter, and subsequently was a prominent figure in British horseracing for 40 years.
But it’s not the width of graduate politicians & Civil Servants it’s the depth. Very few, even of the middle classes, went to university. And few MP’s went into politics straight from education. They did proper jobs. So they had experience of the world to influence decisions.
How many MP’s now have ever been involved with commerce at the sharp end? The route seems to be uni. Then NGOs, local government, charities, bag carriers, the law..Useless bunchacvnts.
And no, CN Parkinson got the Civil Service definitively right. He understood the incentives..
Again I remind you, only three Prime Ministers elected since the war didn’t go to Oxford. One went to the Jockish equivalent, one wanted to but couldn’t afford it & the last was screwing on Oxford graduate. Spans the time the UK went form a Great Poer to a third world shithole.
For accuracy, I should have said since Churchill. As Churchill wisely gave the university system a wide berth.
Jim mCallaghan was Prime Minister from 1976 to 1979
Makes you wonder about the backbenchers
In the 1980s I failed to get into York. Last year my nephew got into York on first go. Standards have really fallen. 😉
It will be the “white heat of technology” next. That went well.
Sounds a bit racist?? Shouldn’t it be the ‘black heat of technology’ these days?
They always ignore the cost to the economy of the taxes to raise that money.
Last year’s NI rise has already caused so much damage to the economy that it’s lost 109,000 jobs; Kyle’s “thousands of new jobs” isn’t going to make much of a dent in that.
https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/uklabourmarket/november2025
£26 billion for the British Investment Wank? Funnily enough the NI rise is predicted to bring in £24 billion; if they hadn’t done either they’d have avoided a huge amount of economic decline, saved roughly 100,000 more jobs than they’re going to “create”, and still been £2 billion ahead.
But that wouldn’t have let Kyle, a man who says he left school “without any usable qualifications” and whose only non-political job was as a charity aid worker, to pose around at Davos, would it?
I remember the days when El Reg still bit the Hand, before going all Wokey and ..Californian… that such bold statements were made about ICT , and later “Alternative Energy” .
Noughties and early Tens…
With UK govt. mouthpieces uttering the exact same words.
And people pointing out that other than the Usual Suspects already on the Trough, the rest were proven Serial Entrepeneurs who’d fail, as usual..
( and , unbelievable nowadays…. did not get their posts Flagged, Redacted or Removed… )
So…Same Old, Same Old….
Oh the shame of having these malignant fucktards representing the husk of Britain, even though it’s only at the globalist circlejerk festival of graft.
What makes anyone think that government – moving slower, with weaker incentives – is going to find hidden gems?
They’re not. But they’ll immediately find a long queue of subsidy farmers, a great many of whom will be more than happy to recycle some of those subsidies as Party donations. Exhibit A: Dale Vince.
Kraken’s one of these things where a company builds some software and then realises they can sell it to other companies. Like Pixar license their main software (Renderman) to other movie companies.
The question is how much business is that. It ain’t going to be the big energy companies, they have huge, mature software platforms already. There will also be software houses doing this too that have been doing it for decades. Billing for utilities isn’t exactly a new thing. It’s an effing boring thing. Even if Kraken takes the business the margins are going to be tiny because there’s competition.
“With its funding capacity increased to £25.6bn from about £15.6bn, Taylor’s team has a souped-up range of investment schemes, mainly aimed at eight key sectors that ministers believe have the highest potential to drive economic growth over the next decade: advanced manufacturing, the creative industries, life sciences, clean energy, defence, digital and tech firms including artificial intelligence, financial and professional services.”
The problem is that it’s the whole “sexy” thing. The creative industries are one of the biggest bonfires of money going. Life sciences are like 95% of it fails, and you make huge money on the 5%. AI? I wouldn’t touch AI.
As TP rightly said, paraphrased: You don’t go into Creative Industries to make money, but to *spend* money.
And it should be ultra ultra vires FFS.
Well at least it gives the rest of us all a marker. If a company gets an investment from the BBB that means steer well clear, because its pretty much certainly a right dog of an investment, if not a complete scam.
“1500 staff in their head office” sounds like 1500 admin staff. How many actual do-ers have they got?
Why would a digitally-based new company require loads of admin staff?
Just because they are at the HQ doesn’t mean they are admin staff. When I was at what was to become Orange most of the core engineering and operations team was based in the HQ at Bristol. They outnumbered admin staff by 2 floors to 1.
I don’t say they need loads of admin staff, just the phrasing “head office”. That’s where the admin is done. Not “1500 workers on the factory floor” or digital equivalent. Pure grift farming.
JGH- yes! that Peter cited the number of Head office workers in his ‘this is how i’m spunking your money’ brag, is pure pure cringe.
It’s a strange one because normally, long before you hit 1500 admin staff, you move most of it out of London and into cheap towns like Runcorn, Peterborough, Slough or Swansea. You can get the people in these places, and you can get them cheaply.
I used to work with water and phone companies and they were all in undesirable towns. If they had an office in London, it was more “corporate affairs” and not very big.
When I see businesses in London they are smaller ones. Under 50 staff.
It seems they’re based on Oxford Street, the slightly less derelict end, so it can’t be cheap?
That depends. If they’re using one of the IT consultancies or even lots of contractors it might be easier to start there and then when you sack them move out to the regions. London has the advantage of access to people will to work contract.
You don’t get a lot of that now. Apart from work from home, a lot of IT is now remote, as in, there’s a team in Swindon or Newbury doing the work when you hit a certain size.
“They’re now employing 1,500 people in their head office in London alone.
“We can find other companies that are on that kind of trajectory …”
I’m sure you can. But hurry, because companies on that kind of trajectory will not be around for long.
“I was at Octopus yesterday. They’re now employing 1,500 people in their head office in London alone.
I was just about to make a similar comment. Not withstanding Tim’s constant reminder that jobs are a cost, you do need people to build and grow a business and here lies the difference between the Simple Shopper (How I miss that site) and private investors.
An MP walks in to that room and thinks what a lot of people, it must be successful.
A private investor would walk in and ask:
Of course that’s part of satisfying themselves the project is going to make a return.
Well, at least those were the questions we were asked to find out, as well as the usual engineering ones, as part of the due diligence projects we did for investors.
An MP walks in to that room and thinks “what a lot of people who are going to vote for me. Let’s have more”.
I had a quick peek at Kraken’s website.
“Help us build a smarter, more sustainable future for energy”
I’ve been seeing that exact same phrase on an increasing number of job vacancies from all over the place. Looks like a crowded bandwagon that everybody is jumping onto.
Too many politicians look at the vast number PE and VC firms scouring for investments and often losing, but picking enough gems to keep them trying, and think to themselves – all that money wasted when we already know what will be winners (and can protect them for fat incentives for ourselves if necessary).
All these PE and VC people who wasted their college years studying engineering, science, business or whatever, when if they’d majored in grievance studies they’d know what the world needs.
Pollies look at the world, decide how it should be, centrally plan everything, deduce what sort of goods & services it will need, and then back the surefire winners who will supply said.
And then the world turns out entirely differently, not least because someone somewhere goes and invents things no-one thought they needed such as the Internet, mobile phones, and computers with more than 512 bytes of RAM, and suddenly there’s no market for the winners the pollies picked. Those private sector bastards did it instead.
It’s a tough life, eh?
100%. If the government just fucked off out of the way and let people & markets pick their own winners, then taxed them a reasonable amount (a sight less than now) they would raise a shit load more for a lot less risk.
But it wouldn’t give them the control they want or the hard on they crave from talking about the billions they are spending.
They will be using stupid criteria, like the number of jobs, how “green” it is, and whose constituency will benefit….. Grrr!
“What makes anyone think that government – moving slower, with weaker incentives – is going to find hidden gems?”
The more likely – and bigger – danger is that government will use it’s regulatory powers to MAKE hidden gems.
Laws and rules that advantage their own holdings can make a company, or break others.
That’s why government ought not be allowed in the pool. They’re the lifeguards and rule-writers. I’d not want to be competing with them.
History is against the idea that the State can find hidden gems, even with its fingers on the weighing scales in their own favour. The history of industrial policy (in the UK at least) is the litany of stories of the State picking an industry thats already in decline and attempting to gerrymander a UK ‘champion’ out of it, that proves to be world beating at one thing only, making losses.
I can think of one success only, and that was the nationalisation of Rolls Royce back in the 70s. They did have a world beating product (the RB211) and it was for once in an industry that was a growth area. They just needed money to tide them over until the RB211 came on stream. Once it did they never looked back.
Other than that its a sad history of decline and losses. And of course RR was a successful private company first. It wasn’t a State financed startup. I can’t think of one of those thats been successful. The ultimate irony being that 40 years before the RR nationalisation the UK State had already decided Frank Whittle wasn’t worth spending any government money on because his jet engine idea obviously had no future……they could have owned the jet engine business lock stock and barrel, but hey, The State knows best!
“Betting big” “Picking winners”.
Is this what we want the government to do with our money – gamble?
This cunt sounds like the losers in my local before the 3.15 at Haydock.
Without more customers, what does this give you?