麻豆传媒

ADVERTISING FEATURE

SIMON ROGERSON is musing on the forces that make good businesses behave badly. Take the financial services industry, for example. Between 2010 and 2014, UK banks paid out about the same amount of money in fines as they did in bonuses. It鈥檚 a statistic that gets to Rogerson.

鈥淗ow does an industry behave like that? When you鈥檝e had to pay 拢38.5 billion in fines and compensation, how can you think it鈥檚 right to pay yourself 拢32.6 billion in bonuses?鈥� he asks. 鈥淚t鈥檚 no wonder this is the least trusted industry in the world.鈥�

For Rogerson, this kind of behaviour is an opportunity. He and his colleagues Chris Hulatt and Guy Myles were young graduates, working for one of the largest financial companies in the world, when they decided it was time for change. They had an idea: if they created a company that made it easy for people to understand what happened to their money, to feel connected to their investments and be confident in the results, customers would come.

And they were right. They launched Octopus in 2000, and it has since become a company with 700 employees overseeing 拢7.5 billion-worth of investment. It has also helped Rogerson and his colleagues hone a business model that has expanded into other industries, such as healthcare and energy, and is changing them from within.

There鈥檚 a common thread here, says Rogerson. All these businesses involve things that matter most to people, namely money, health and the environment. Yet incumbents in these industries tend to be a source of confusion and stress. The aim of the Octopus Group of companies is to give control back to the customers.

鈥淲e鈥檝e been creating quite a stir in the energy industry, by lifting the lid on what has been happening for decades鈥�

Rogerson still remembers their first investor who posted them a 拢9000 cheque back in 2001. Excited, Rogerson called them. 鈥淚 don鈥檛 know what was going through my head but I said 鈥榊ou are our first ever customer鈥�,鈥� he recalls. 鈥淲e spoke about the investment industry and what he believed was wrong with it. Things like 鈥業 find them difficult to relate to鈥�, 鈥業 can鈥檛 understand the information they send me鈥�, 鈥榯his really matters to me because I feel responsible for my family.'鈥� Now, 18 years later, this customer is still with Octopus, demonstrating the kind of loyalty that validates the company鈥檚 mission.

Rogerson believes people increasingly want to use their money to help make the world a better place 鈥� by creating jobs in small start-ups and claiming the tax benefits that come with this, for instance, or helping to generate renewable energy. 鈥淲ith this information, people suddenly want to talk about what their money has done, it becomes interesting and engaging,鈥� says Rogerson. 鈥淎nd that builds a stronger relationship with the customer.鈥�

鈥淲e can out-behave everyone. That鈥檚 the thing that sets Octopus apart鈥�

Simon Rogerson, Octopus Group

Building these stronger relationships is a key part of all the group鈥檚 businesses. In 2011, for example, Octopus built a solar farm, the first of 154, and began selling green energy straight to homes in 2015. The company is now the UK鈥檚 largest investor in solar power and attracts growing numbers of people who want to help create a sustainable planet.

Octopus Energy also aims to make life easier for people by allowing them to change energy suppliers quickly. Using the company鈥檚 app, customers can sign up in around 80 seconds. One person managed it in 42.

In the spirit of transparency, it鈥檚 also easy for customers to move away again. At the bottom of each bill, Octopus Energy tells its customers how they can get a cheaper tariff elsewhere 鈥� if they want it.

Few do. On the contrary, the company attracted 180,000 customers in its first two years and its customer base is currently growing at a rate of around 10,000 a week.

That鈥檚 partly because the energy industry has treated customers so badly in the past, says Rogerson. 鈥淭he Big 6 [UK energy companies] lose money on you in the first 12 months deliberately and then on average put up their tariff by more than 30 per cent,鈥� he says. 鈥淏ut their websites emphasise 鈥榗ustomer service鈥�, 鈥榬esponsibility鈥� and, 鈥榚thics鈥�. Who are they kidding?鈥�

Octopus Energy does things differently. It has successfully campaigned for a price cap to limit how much companies can charge for energy. 鈥淲e鈥檝e been creating quite a stir in the energy industry, by lifting the lid on what has been happening for decades,鈥� says Rogerson.

Another sector the group has focused on is healthcare and education, in part as a safe investment opportunity. The thinking is that demand for schools, hospitals, doctors鈥� surgeries, care homes and so on is unlikely to drop in the near future. And that creates a financial environment that is 鈥渞eassuringly boring鈥�.

But the desire to tackle things that matter to people is central to this business as well. 鈥淪chools for students with learning disabilities tend to be owned by charities that are passionate, but don鈥檛 have the capital to expand,鈥� says Rogerson, by way of an example. So Octopus Healthcare builds new infrastructure and then runs it as a business, allowing the charity to focus on its core skill of care-giving.

鈥淧eople suddenly want to talk about what their money has done鈥�

Rogerson says that, above all, the standard of behaviour is paramount. Other companies fill their brochures with words like 鈥渙ut-perform鈥� and 鈥渙ut-compete鈥� as a way of luring customers who want a quick buck. Never mind those, he says. 鈥淲e can out-behave everyone. That鈥檚 the thing that sets Octopus apart.鈥�

2000: Three founders launch Octopus Investments

2004: Funds raised for Venture Capital Trust investments

2005: Range expands to include Enterprise Investment Schemes and inheritance-tax products

2007: Octopus Ventures launched

2008: Named by Sunday Times as one of the UK鈥檚 100 best SMEs to work for

2009: Reaches 拢1 billion assets under management

2011: Reaches 拢2 billion under management

2014: Healthcare specialist MedicX becomes Octopus Healthcare

2015: Octopus Group formed: Dragonfly Property Finance renamed Octopus Property, Octopus Labs and Octopus Energy launched

Find out more at:

This article appeared in print under the headline 鈥淏est behaviour鈥�

Further reading
The hidden powerhouses that drive the UK economy
The flexible future of green energy
Why better data laws will change the nature of business