Business Secretary backs British scaleups with growth package and red tape review

• British Business Bank makes largest ever direct investment into a private company – Octopus Energy spinoff Kraken Technologies – alongside £100m in fund investments for Life Sciences and Deep Tech Major – key Industrial Strategy sectors.
• New reviews will simplify health and safety and farming rules, reducing paperwork, cutting duplication and supporting innovation while keeping essential protections. 
• Corporate reporting and competition rules will be modernised through new consultations, reducing costs, speeding up decisions and strengthening the UK’s pro-growth regulatory framework.

British entrepreneurs, workers and communities will benefit from a sweeping package of growth measures delivering the Modern Industrial Strategy, as the Government acts to invest in key growth sectors, slash red tape and ensure promising UK companies can scale up at home rather than being forced overseas. 

Business Secretary Peter Kyle announced the new measures in a visit to Kraken Technologies’ London headquarters. It comes as The British Business Bank (BBB) will make its largest-ever direct investment to date using new flexibilities from the Business Secretary: £25 million into Kraken Technologies to help the company scale up and become a UK champion. 

Kraken uses AI to improve customer service and billing for energy companies. It is used by major energy companies around the world to serve 70 million customer accounts and may list in London following its demerger from Octopus Energy Group.

Today’s investment follows reforms to the Bank’s mandate so it can take bigger, higher risk stakes in the UK’s most important scale-ups in sectors prioritised for growth in the Modern Industrial Strategy ensuring the UK retains its competitive edge.  

The Bank will separately invest £50 million each into two high potential Life Sciences and Deep Tech funds: Epidarex Capital and IQ Capital.  

Other measures announced today form a significant drive to simplify regulation — removing unnecessary paperwork, streamlining compliance and speeding up processes across key growth sectors. It comes as part of the Government’s commitment to reduce the administrative costs of regulation by 25% and deliver a simpler, more predictable environment for business. 

Business Secretary Peter Kyle said: 

For too long, Britain’s most promising companies have had to look abroad for the backing they need to grow. Scale-ups that should have become homegrown champions struggle against a system that is too slow and too fragmented. This package changes that. 

We are placing big bets on the industries where Britain can win, backing our innovators with real firepower, and cutting the red tape that holds them back. This is what decisive government looks like – creating an economy that can grow and deliver prosperity for all.” 

Regulatory reviews will simplify Health and Safety rules and streamline Farming and Agri-tech rules, reducing paperwork, cutting duplication and supporting innovation while keeping essential protections. 

The Government is also scrapping the Audit Reform Bill to avoid significant new costs for large firms, pressing ahead with plans to allow virtual AGMs and streamline corporate reporting, and launching a consultation on 20 January to speed up and simplify competition investigations—working closely with the CMA while preserving its independence. 

The package today also delivers the Government’s largest single commitment to battery research and development: £180 million provided through the £452 million Battery Innovation Programme announced in the UK’s Modern Industrial Strategy. 

A strong UK battery sector is vital for net zero, energy security and future manufacturing, with the industry already supporting 10,500 jobs across the UK including significant battery hubs in the West Midlands and North East. 

The money will fund R&D projects and investor partnership grants that help UK battery start-ups and scale-ups to secure match-funded private capital. The funding will go directly to companies, helping them compete globally while anchoring their growth in the UK. 

The package comes ahead of the Business Secretary’s attendance at the World Economic Forum in Davos this week, where he will engage with business leaders and set out why the UK is truly the best place in the world to invest, with a culture of entrepreneurship, world-class education and certainty for business. 

Greg Jackson, Founder of Kraken and CEO of Octopus Energy Group, said:  

Over the past decade, we’ve built Kraken from zero into a true powerhouse. It now plays in a league of its own and is ready to spin out of Octopus – and with backing from world-class investors like the British Business Bank and Octopus Ventures, it’s poised to grow even faster and cement its position as a UK-founded, UK-funded success story.” 

Jordan Cummins, UK Competitiveness Director, CBI, said:

Cutting red tape and helping businesses scale-up is central to our collective growth mission. This latest package from government is therefore a good step on the journey to helping the growing firms of today become the global leaders of tomorrow. Maximising the catalytic role of the British Business Bank and making big bets on battery technology are smart moves to keep the UK competitive.

Businesses across the UK are now looking for more of this partnership working approach, particularly as we advance sector and regional growth plans. This can help drive up firms’ appetite for investment, as well as delivering the job creation and productivity growth we desperately need.

Stephen Phipson CBE, CEO at Make UK said:

Today’s announcement is a welcome stride towards enabling the country’s manufacturers to scale here at home. Make UK research into SME manufacturers revealed that two-thirds have ambitions to grow into large businesses within the next decade, yet four in five say they face hurdles in accessing the finance needed in the early stages of scaling – it’s good that these announcements move to tackle that.

The move to reduce scale-up related regulation and increase the ease of navigating public support are both crucial steps in enabling Britain’s titan firms of the future which have too often been hamstrung at their early stages by unnecessary regulation.

Altogether, this is an important step towards fulfilling the sector’s hopes for a game-changing industrial strategy. Improvements in growth capital, backing today’s scaling firms and cutting red tape all form an important part of delivering on that.

Amir Orad, CEO of Kraken, said: 

Kraken is a global company, operating across four continents, with a mission to positively impact a billion lives within the next decade — but our roots are firmly in Britain. That’s why we’re delighted to welcome the backing of the British Business Bank.

Alongside our other fantastic investors, they’re helping us modernise global utilities and build an energy system that’s resilient, reliable, affordable and future proof.

Notes to Editors: 

• These measures form part of the Government’s Industrial Strategy, with an update on the strategy reporting over £79 billion of investment was secured in priority sectors in the most recent quarter alone, supporting more than 50,000 jobs.
• This record investment package follows more than £1 billion of British Business Bank commitments across their investment and banking businesses over the last quarter, a major increase from last year. 
• UK Export Finance has also provided over £9 billion of support so far this financial year to help UK businesses grow, invest and secure new contracts overseas/
• This month the Chancellor and Business Secretary will also convene major banks to press them to unlock more export finance for ambitious UK firms, and ask Ministers to develop and set outcome‑focused growth goals for key watchdogs that lack clarity on growth.
• Since taking office, the Government has launched the £27.8 billion National Wealth Fund, expanded the BBB’s finance to £25.6 billion and increased UK Export Finance’s capacity to £80 billion – with plans now being brought forward for a substantial further increase to UKEF in the coming months.