Nico Johnson  00:00

As we electrify everything, EVs, heat pumps, batteries, flexible demand, the power grid is about to get dramatically more complex. Instead of a few 1000 large assets, we're moving towards a world where millions of devices interact with the grid in real time. At that scale, the challenge isn't really generating electricity anymore. It is coordinating it. That means the grid is slowly becoming something it was never really designed to be, a software, managed system. Today's guest has spent the last decade building exactly the kind of platform we need. Devrum Jalal is the chief flexibility Officer of Kraken, a system now managing millions of energy devices and helping utilities rethink how the grid actually operates. Devrem, great to have you on SunCast.

As we electrify everything, EVs, heat pumps, batteries, flexible demand, the power grid is about to get dramatically more complex. Instead of a few 1000 large assets, we're moving towards a world where millions of devices interact with the grid in real time. At that scale, the challenge isn't really generating electricity anymore. It is coordinating it. That means the grid is slowly becoming something it was never really designed to be, a software, managed system. Today's guest has spent the last decade building exactly the kind of platform we need. Devrim Celal is the chief flexibility Officer of Kraken, a system now managing millions of energy devices and helping utilities rethink how the grid actually operates. Devrim, great to have you on SunCast.

 Devrim Celal  00:45

Nico, thank you for having me.

 Nico Johnson  00:46

I've been looking forward to this conversation, especially since we had Nick chasit from octopus on and we talked about the reality of kind of what Kraken has become, what it means for the world. I'm so glad that we're going to be able to unpack it for our listeners, but I want to start with a simple question. When did it first become clear to you that the future grid was going to need software to coordinate these millions of devices?

 Devrim Celal  01:11

When I think back, I probably didn't know it at the time, but it was I first came across energy in mid 90s, when the European markets were liberalizing, we were breaking it up and making it competitive. Then I came back into it around the time we started what's Kraken today, and a colleague of mine from a past life called me and said, Hey, I was living in Istanbul at the time, doing reinsurance brokerage in a completely different industry, and said, Hey, I've got this great idea. We are going to build a high performing software platform that will connect to millions of UPSs. I don't know what that was. I'll come back to that in a second. And using their storage, we're going to create this balancing reserve, because renewables are intermittent and we need to shape energy.

 Nico Johnson  02:01

Wait, wait, how long ago was this? This was 2014 Wow. I mean, thinking of the conversations we're having right now with AI data centers, how prescient was that? Thought the first thing I had to

 Devrim Celal  02:10

do was look up what a UPS was exactly uninterrupted, which is the little box under the table that has got a bit of an energy buffer. So if power gets cut off your computer, you have enough time to shut off your computer. And because they hold all this small amount of energy, and there are so many of them, the idea was, if you can connect these hundreds of 1000s of devices together and switch them on and off in unison with green generation or grid congestion, then we can solve many problems from from an idle resource that existed already on the on the system, and that was the initial time, the first time I ever started thinking about it. The realization is coming every single day, as more electric vehicles, more heat pumps connect to the Kraken platform, you realize the power of that additional flexibility at the edge of the grid, before

 Nico Johnson  03:05

Kraken or upside energy, the company that was the predecessor you had already gone through what I think was a very valuable and varied career across across a number of different industries and ventures. Could you walk us through that journey a bit. I think it's instructive of exactly why and how, sort of the concept of managing devices, investing in grid infrastructure, and you devream Like, why they are, in fact, good pairing.

 Devrim Celal  03:35

So let me take a big step back and maybe introduce my career to and I, I think of it in these three phases. The first phase was, like probably many people listening to this student, needing to make money. And I've done, I've done a lot of things in that one, the one, the toughest one, was operating a market stall not far from where our office is today, in North London, selling ladies clothing, very early mornings, cold days, and hustling in the street, 1214, hours, every, every time. And then, then I graduated from under my undergraduate and became a software engineer, and I wrote code for a few years. Fortunately, I haven't written any code in the past 20 years that somebody had to use, that's a good thing. And then I did an MBA. And post MBA, I initially had the very traditional career management consulting finance for a while, long enough to build, you know, toolboxes of experiences, toolboxes of relationships, little trinkets, and then enough of a small capital to say, I want to try something on my own. And that was the that was the start of a long entrepreneurial venture. And always kept one thing in mind. A colleague had told this to me a long time ago. Every business is. Same they need to generate more cash than they consume or have a capital infrastructure to sustain that up to the point where they could do that. And through that, I've done real estate insurance, commercial property development. I operated a hotel. For my sins, if anyone is ever fantasizing about retiring and owning a little boutique hotel, don't and it was along that journey that I came across a colleague called me and said, Hey, I've got this great idea. And it felt, it felt like the it felt like a worthy cause, because I was very deeply starting to think about climate change and how I could actually be actively participating in fighting the good fight. And that was, that was the start of what was upside energy at the time,

 Nico Johnson  05:50

Devin, before we dig in to really the meat and potatoes here around how upside became such a core piece of your work life, at what point did you realize that you were an entrepreneur? What were those signals that a listener might identify in themselves that pointed you in the path of not corporate and consulting, but rather digging in and building something?

Devrim Celal  06:17

My first entrepreneurial venture was really deep, deep dive on the deep, hot, choppy end of the the the commercial world. It was a it was a real estate mixed use property development, and it was a humbling experience. I had been working in technology up to that point in a fairly successful high speed tech business called sapient. And I stopped that. I went back to Cyprus, because some of you may know Cyprus is a divided Island, and there was the opportunity unify. So dropped everything and moved to Cyprus. And at the at the end of that process, which didn't go, where we but I decided to, I decided to stay in Cypress and look for something to do. And it was really the trigger. What do I do next? And there wasn't something formal, interesting enough, so I said, I'll do something myself. And that was the initial jump into creating something that I really wanted to do. Sort of wrapped that project up slightly longer and slightly more painful than I had prepared. I was wondering, what do I do? And I went to a safe place, I went to consulting, I went to advisory work, which I knew there wasn't a big capital outlay, there wasn't big commitment. You didn't need a big theme. You can pretty much run it on your own. And that took me to Istanbul, because when you do that, you need to be in a big economic hub with people with business. And I was thinking is sort of 2000 10s onwards. I had a I had a beautiful life. I was doing reinsurance brokerage. Had a partnership with Willis towers, Watson, covering Russia, going to all these interesting places that I would never go back to not because I didn't like them, but there wouldn't be many reasons to go to Yamal or or roslo on Don for example. And during that period, it was when I got the initial call from Graham who had the idea for upside and the other thing I could afford to do those days and afford in terms of time, is go running a lot. I would do these ultra distance, crazy runs around the world, which gave me a lot of time to reflect, like reflect on racing. I never called them racing. I participate for them.

 Nico Johnson  08:37

How long is an ultra run? For those who are unfamiliar

 Devrim Celal  08:41

in miles, anyone for anywhere from 30 miles up

 Nico Johnson  08:46

the long like 50 kilometers and more.

 Devrim Celal  08:48

Yeah, the longest I've ever participated is in 200 miles, 330 kilometers, 200

 Nico Johnson  08:56

Wait, wait, as a relay or as an individual push.

 Devrim Celal  08:59

It's a It's as an individual, these tend to be in mountains or deserts, just to make it a little bit more fun. Yeah, of course, they're multi hard enough, no, semi self supported, where you carry your backpack, some food equipment.

 Nico Johnson  09:15

Yeah, and you're going like the western states, for those who are familiar, here in the

 Devrim Celal  09:18

US, 100% perfect example, yeah. And that gave me a lot of time to think, no doubt, how, how would it be? How would it be to go into something bigger, where you're committing long and you have to have that faith, the belief in the idea, you have to bring that faith, to bring investors, team members, to drive that and I thought, yeah, it was, it felt like the right thing to do, yeah.

 Nico Johnson  09:44

So Graham calls the original one of the original founders of upside and says, I've got this great idea. How did you How did you know the original founders? Like, how does Graham know you and consider you someone

 Devrim Celal  09:55

who might invest Graham, I knew from my career at sapient. Okay? Late 90s, early 2000s we worked very closely together. I had extremely high regard for him, so it was a natural, easy one. Again, if you remember I said, you know, I built this little box of good relationships, a little bit of, know how he was in that good box of good relationships?

 Nico Johnson  10:15

Yeah, I think it can't be overstated, and it's often under appreciated that the first 10 years of your career, if done right, really gives leverage for the rest of your life if you dig in, develop not just your core skills, but a network of people who don't have to be this is the myth people think it has to all like all needs to stay in the same industry. No, no, no. I've seen people like you, Debra, jump industries because, because you associated with and also impressed other interesting people, it usually is

 Devrim Celal  10:48

quite magical when it all comes together. And you have to realize, you know, not everything always works out.

 Nico Johnson  10:55

No, I can't explain clearly enough for those who haven't been through it yet, how true it is that like success is 99% luck, 1% persistence, but the persistence feels like 100% like it feels like 100% and then the serendipity of putting yourself in the right place over and over again is what generates the luck and the success, like luck is Being prepared when the right thing comes along. So Graham, no doubt, had been watching you a past colleague, both making money and succeeding in certain ways. You get the call and ultimately decide to invest in what he was going to do. What did you believe that business was going to be or looked like in its early infancy, what you had invested in.

 Devrim Celal  11:43

I took the investment decision, and I realized immediately that the need of the business was more than just money. They need to raise more money. They need to start building some structures around it. So the initial decision was that actually join as an interim CFO, yeah, and to

 Nico Johnson  12:02

make sure your money gets spent, right?

 Devrim Celal  12:04

That was that probably wasn't in my mind that much in my brain, right? Yeah, no, it was the skills that you have, yeah. And I joined, and I, as you do, I prepared a business plan. It was a good exercise. We stretched our reflex, built our reflexes of if things happened this way, this is what we should do, put to put it on a piece of paper. And I went on the road reaching out to friends, family, colleagues, all the people that you met over that 10 years and probably a little bit longer than that, I said, Look, guys, here's an idea. I am investing one principle, if this fails, we're friends, because it could fail and raise the first friends and family, seed capital and the real validation, the real excitement for me, was that people were genuinely interested, and people who knew what they were doing, what this was meant to do. I wasn't one of them. I was going on a real, real intuition, instinct, reflex, a little bit, and that's where it got serious, because suddenly I had people's money, and that had to be that had to generate a return.

 Nico Johnson  13:15

You described, for me, sort of the different phases of the company, and we're describing it as upside it is what effectively became cracking inside of octopus. I want to, I want to get, I want to kind of pull back the veil for folks that can see the acquisition story through the phases of the journey.

 Devrim Celal  13:33

And I often present that as a defensive mechanism to say, after a sentence, this is the longest job I've ever had by a massive stretch. I've couple of months ago, I celebrated my 10th anniversary here. And when I look back, and I always look back and try and rationalize things, and I think that may come out of this discussion as well. It's actually in phases. The first couple of years was really figuring things out, we had raised some money. We got a lot of money from the British government and some grants from European Union that allowed us to test things quite freely. That led us to our second phase, which was we raised series A it was enough money for us to sit back and say, who do we want to be when we grow up? And the answer was straightforward, we were software people. Energy was coincidence for us, and that's when we pivoted or executed our strategy, whichever you want to take that to become a pure software platform. That worked out well. We went through great growth. We brought in fairly significant customers, like EDF Energy, UK's largest power trader, to use the platform from very, very early

 Nico Johnson  14:45

days, for trading,

 Devrim Celal  14:48

for trading, for power trading, or balancing their books, the way I put it, yeah, of course. And then we were raising our series B, we had the backing of our existing. Investors with a term sheet, we were fairly confident we were going to get econore, which is the Norwegian state utility venture fund, investing in us. I remember it was February, 2020 I guess we went to perfect final investment committee, exactly. Final Investment Committee. And the decision came saying the answer is yet yes, but to get to close, you need a third strategic investor. Yeah, and covid was just starting to happen. We roughly knew what it was. Oh my. We didn't know what it was going to mean. Had about six weeks of runway at that point.

 Nico Johnson  15:40

Whoa. Thank you. Appreciate the vote of confidence.

 Devrim Celal  15:45

And we went, we went to the investor for anybody

 Nico Johnson  15:49

listening, by the way, as strategic is someone in the industry who believes in you so much they'll put their dollars to work expecting that they'll get something out of it later. So keep going.

 Devrim Celal  15:57

That's it. Thank you. And I already knew the team from octopus. They had just raised their major funding round from the Australian utility origin, which made them a unicorn. And I gave them a call, and guys, I said, Look, you know, is there any any money left from that few 100 million that you guys picked up? And it started quite positive. We continued for a while, and it became quite apparent that the vision we had and the vision they had have still were identical. The cultures were very complementary. So we thought, let's cut to the chase. We know where this journey is going to end one day. Octopus said, Why should we pay a premium? Let's cut the cord now and turn this into an acquisition. And that pushed us into the third phase, the initial phase with an octopus which is which has been quite an accelerating journey, because when we joined, octopus already had a Kraken, which was the customer management part, so everything to do with customer relationship management, billing, meter, data management, user interaction that was already built in house for the use of octopus energy, we brought in the asset optimization side, and we went through a phase of a Couple of years where it was just experiment, experiment, grow, grow, grow, grow, grow, grow at any means possible, build new product, because it was a race to get their first land and start growing.

 Nico Johnson  17:31

Can you contrast, as an entrepreneur, the pre and post acquisition time like what I'm thinking about here is, like a lot of viewers, listeners, perhaps don't have yet, the experience of being acquired and the freedom. There's a lot of constraints. There's a lot of like, sort of, we got to get organized now, and got to learn how they do things. But the freedom that comes from now having a balance sheet, from having a bigger sort of playground to deploy assets into. Could you contrast those

 Devrim Celal  18:00

two worlds. What I learned is raising five to 10 million pounds is probably harder than raising a few 100 million it says just the momentum, the story, the delivery, the scaling, drives a lot of that, and the the nature of it changes. You have to, you still have to prove everything. You have to go through due diligence. But it, it felt we continued to raise money within the octopus Energy Group body, but it felt a lot easier to do that, and maybe by time we joined octopus, it was already a unicorn. There was a solid story. So we were rising that platform up altogether in terms of operating within a bigger company, as you said, with a balance sheet, it didn't feel like that. Still doesn't feel that way. It was a very devolved, autonomous structure where we believed we were all mature professionals targeting the same mission, and for as long as we did the right thing, then we will all end up in the same place. We may duplicate things. There may be a little bit of chaos, there may be inefficiencies, but for as long as we're off the gates first and running fast to that same target, we were allowed to do things as the way we did. And upside crack and flex bit on octopus continued exactly the same way, but just growing at multiples faster.

 Nico Johnson  19:24

Yeah. And so phase three is internally octopus. You take over the the initial internal sort of customer data platform. Why did it become clear this needed to become more of a platform for the broader industry? Walk us through the next

 Devrim Celal  19:41

two phases. The mission at octopus and similar in Kraken now was and still is, to use technology to allow cheaper and great electricity to masses around the world. There isn't any reference to a metric target or any any reference to a. Financial one, it's a big, audacious goal. Krakens one is to to put a big green dent in the world, to impact the lives of billion people positively. So societal targets that give us freedom on what we do, but also drive strategy. So if you want to achieve such a big goal, you can't do it on your own, the way I often describe the Kraken octopus story is like if octopus had been Coca Cola, and allegedly Coca cola's formula is hidden in a vault in Atlanta somewhere, they would have locked Kraken up and not let anybody else use it. Instead, the strategy has always been not only make Kraken available to octopus competitors, but teach to every single one of them to how to operate like octopus did, and that comes from having the right objective, which didn't restrict us from playing with our parent company's competitors. So that was the dynamic within the organization at the time, and as we

 Nico Johnson  21:03

discussed when Nick chasit from octaves was on, it became clear that it was actually easier and probably easier to hear in your words, and went inside of Kraken. But at some point became clear we need to separate the two brands for the better of our customers, so that they can, can maintain a sense of trust, that they're not playing with the devil, right? Like, and I'm being, I'm being antagonistic here, but like, I see it all the time, just in the US solar industry, for example, I see it all the time, right? Like, developers want to see that they have a breadth of choices in the marketplace. And as we see it, we see a lot of consolidation right now in the market of certain players in the infrastructure side, and there are people on both sides of the camp. I kind of don't really want to limit my choices to one player, right? Of course, yeah, certainly not if that player is one of my potential competitors.

 Devrim Celal  21:55

And you know, some industries know core petition really well to compete and cooperate the same time. Utilities on upstream are very good because they share risk. It's big budget items. They collaborate on those, but compete for downstream, for consumers. But there's an interesting story, if been what came first, Kraken or octopus, and that sort of explains some of the reasoning behind or explanation why it was so easy to separate Kraken. In Kraken we use our software deployment is continuous. So even during this podcast, we will be deploying several iterations to Kraken roughly once every 10 minutes. So recently, few months, a couple of months ago, we reached the 200,000 iteration of Kraken. And naturally we thought, we'll write a little post and post it out for people to know. So I went back and looked at when was the first line of code in Kraken deployed, and it was August 8, 2015 as it happens, octopus was not incorporated till April 2016 so Kraken actually came first. Octopus was the demo client, because utilities, for good reason, are quite conservative. And when, when the founders of October synergy were shopping around for potential customers and saying, Hey, we're going to build this platform that will unify all your data, make it much easier to engage with consumers that would delight them, delight your employees, make you operationally more efficient. One half said, we're already quite happy with what we have, and the other said, What a brilliant idea. But who's going to go first? So octopus was created to be the first demo client for Kraken. And even from that day on, the idea was that Kraken, different name, will one day be a separate entity on its own.

 Nico Johnson  23:56

Yeah, I'm gonna, I want to actually share some corollaries for folks like I think it's so cool to hear how you impact that story of really incubating the idea of Kraken inside of one of the major potential users. Effectively, there's a lot of in the solar industry a need for even a requirement of the industry. From bankability perspective, this validation from someone much bigger. A great early example. Everyone knows Enphase now, the market leader in modular power electronics. Many people probably don't remember that Enphase couldn't get anybody to buy their products, and so for a long time, Enphase was sold under the Siemens brand. Millions millions of inphase devices deployed under the Siemens brand, right? Siemens effectively white labeled the in phase product to give them bankability. Also, another similar story is next power. Formerly next tracker was, I feel like people forgot this too, like they were acquired by Flextronics. Like next tracker was a wholly owned subsidiary of Flextronics and then eventually spun in. Spun out of Flextronics to go public, became, became the darling of the NASDAQ a couple of now, three years ago. And of course, next power now is a 15 billion market cap company going to what I think will be a 50 billion market cap company. So it's as an entrepreneur, I challenge folks, as you're listening to the story, to think about how there are strategic investors, but then there are strategic platform plays, where you could potentially just incubate your idea in, sort of inside of one of the biggest players. It does not mean that it is a final decision. Doesn't mean that that's the finale, the end of your product. Because, to your point, octopus, if you are aligned with the right philosophical approach. Octopus could have locked Kraken in a vault, but it didn't. So this is a these are decisions that as entrepreneurs, we get to make, and

 Devrim Celal  25:49

in that vein, just to touch on your story, fortuitous timing. Just yesterday, we had a press release with Enphase and Vista about launching a program in Texas. Whoa, so cool.

 Nico Johnson  26:01

That is fortune. I don't even know

 Devrim Celal  26:03

that they've been a good, good partner for for a number of years now.

 Nico Johnson  26:06

Yeah. So they're running Kraken internally at Vista or at Enphase

 Devrim Celal  26:12

vistra Enphase in the homes of Vista, Sky customers, wow.

 Nico Johnson  26:16

Okay, that's cool. So basically participating with Enphase at a controlled devices perspective with VISTA, being able to use Kraken as the sort of software layer to add additional value for the homeowner, that's and for VISTA, frankly. But yeah, okay, cool. We're definitely going to come back to that early on. People imagined managing, maybe, you know, a few dozen devices on the network, at some point you realize the future looked very different. That moment is when it clicked for you that this is really not a few dozen there's a more complex problem you're trying to solve than you had imagined.

 Devrim Celal  26:56

So one of the challenges we face these days, which is not very obvious is this proliferation of makes and models of devices that Kraken needs to be connected to to make us relevant to our utility customers, because every device we add increases the footprint that we can address. And often when clients ask, how many devices do you have, I usually say around 60, growing every day. And one of them said, but really, tell me how many? So I asked the team, and said, Give us an Excel spreadsheet. I'm sure it exists somewhere. And they did, and the list was over 300 and it was, it was a bit of a shock, of a realization. I said, why? And that it's, it's typically driven, by the way the big manufacturing industries are organized. So what you would typically have is, if a car is manufactured at a certain time, it may be different protocol to one that was manufactured later. It could change by where it was manufactured, typically European and US protocols are different. So as you are integrating with one make model, there'll be numerous iterations of that based on geography and time of manufacture. And that's that's become the challenge, because as you know, as energy transition takes hold and more and more manufacturers typically come out of China, the number of devices grow, the only way you can tackle that is to build a team that's bigger and bigger to solve the device integration problem. And we're thinking actively of how we may solve that problem.

 Nico Johnson  28:33

As I said in the intro, we're now in a world where it's not dozens or hundreds, but soon millions, millions of devices, when you and I and the teens and even late aughts were reading magazines talking about this thing called IoT, the internet of things we've seen in the last 20 years, the realization the materialization of this universe where not only do we have 5g internet, everything's connected, but our refrigerators and washing machines truly can communicate with our hot water heater and with our car and with our batteries. What changes when the grid becomes something that can actually coordinate millions of these kinds of devices dynamically?

 Devrim Celal  29:13

The changes on the grid will create the need for controlling these devices dynamically. But what we need to change in the grid to be able to do that is visibility. So I often, I often talk and say, the low voltage grid, that's the last stage and distribution grid, literally, from the box at the end of the street to your home. It's, it's, it's dark. The visibility into that layer of the network is 5% so 95% of time we don't know what's happening at that layer. As it happens that's the layer that we're going to be connecting 200 million EV chargers and heat pumps and batteries and rooftop solar, which will change for the first time in history, how we consume electricity. It. Not going to be the usual profile of low overnight, little bit of a climb in the morning, plateau in the afternoon, and a peak in the evening, when we all get back home, and the industry is still running when we get to that model, that system doesn't work anymore. Now. Why is it the way it is today? Most grids were designed post Second World War, 50s, 60s, 70s, and they were designed by the engineering principle that they should be able to handle the absolute worst case scenario or peak usage, which, where I'm sitting today in United Kingdom, for those of you who follow football or soccer, is the Football Association Cup final half time, when at the end of that first 45 minutes, everyone will go to the kitchen and flick on the kettle to have a cup of tea that creates an artificial peak load in the UK that the whole system is designed to serve. When we have our beautiful, low carbon devices, that peak is going to be even bigger, and it will happen every single day. So that's when it becomes critical that we have real time visibility into that, into the low voltage network. Have a price or a congestion signal associated with that. So companies like Kraken, who are controlling millions of these devices, are informed to say, look at 7pm today for an hour. Do not charge cars in the street, but after 10pm you're totally good to go. And having that signal allows us to start orchestrating and distributing that load evenly. So one we're not over stressing the grid and getting a lot more usage out of it, but at the same time maximizing the use of renewable energy. For those of

 Nico Johnson  31:45

our audience that are real solar nerds, I'd love it if you could give a for example, with the sister and in phase announcement. It's the

 Devrim Celal  31:52

perfect win, win, win scenario, because the homeowner has already made the investment, bought a battery, which they could have bought for a purely personal reason of using their own generation, but they already have that in home. Enphase sold the battery to the home on that basis, and then vistra has a customer with the battery. The investment is made. Now, when you put these pieces all together, the consumer actually gets a benefit, because Vista generates value in the market from trading the power in that battery at the right times. Buy, cheap, sell expensive, charge with solar, sell at peak pricing. So Vista reflects that to the consumer, so they're happy. End Phase could have been just selling a box, a battery that the homeowner uses for their own use, but now they're selling a box that actually generates revenue for the customer. So it's even more valuable. Makes it easier for them to sell, and Vista suddenly has created a low cost flexibility tool that they could use to limit their exposure to extreme pricing events in Texas. So you've suddenly gone from still a decent use case to one that's actually significantly more valuable to all the stakeholders.

 Nico Johnson  33:13

DevRel, I love this, and this is exactly where many of us have been saying that the grid is going to go for a decade or more when sun run and Vivint and others, sunnova even were telling their customers in their contracts, we're going to assign in this contract the ability for us to be able to future price these batteries. This is what we all had in mind, right? It's so fun to see that this is coming to fruition. The question that some are asking right now is, more is, I don't even see it as a consumer protection piece of it, but rather, who's the ultimate customer? Is it VISTA? And you're helping Vista become more wealthy based on these assets that have been sort of placed at the end of the grid thanks to the homeowner making this choice. Or is the is the real customer for you, the homeowner? And the answer to that question determines who makes the most out of this trade? Some would say, Well, who cares? The homeowner had this sort of stranded asset. They were basically getting nothing, and now we're giving them something that's great. Capitalism is ultimately what's going to grow the pie for everybody. But how? I'm curious how you think about it, because one of the things that you said is we want to impact a big green dent, billions of people with this technology. One of the

 Devrim Celal  34:24

biggest change in changes in the electricity system that needs to happen is the realization that the future system cannot be designed centrally. For the past 100 Years of the electricity grids, all decisions were made centrally. Where do we build generation? Where do we build transmission? Where can you add more load onto it? What kind of load you can add? The biggest change we're going through is the top down approach is becoming bottom up. When you and I buy a battery, install a rooftop solar, buy an electric vehicle, we. We're having a direct impact on the grid, and our impact, if you believe, if you believe analyst estimates, is 200 million devices times five, let's put five kilowatt kilowatts to it. It is a big number. And unless we get consumers to participate in this change, we will not have the ability to orchestrate those devices. So it has to start from the consumer, and to get that, we need to give consumer a tangible benefit. Now, if I may, I'll give you a couple of examples of where I've seen this work. The first one is a product that Kraken helped a number of customers launch now, called consumer residential flexibility, where we say to the consumer, we would love to give you cheap range. If you sign up to this program, register your car and give the utility control of that car through Kraken, we will achieve two objectives for you. The first one is you will tell us, when do you need your car charged by and at what level. The second one, we will tell you how much discount you will get for allowing the utility to decide when to charge that car. Consumer gets cheap range. Utility gets, typically nine to 14 hours to decide when to do two hours of charging, that is invaluable. Shift the load to when you have abundance of wind. Shift the load to when you have grid capacity that transport the electrons to that car. That model was launched in January, 2022 today, it has over 400,000 cars on it, and the beauty of it is new and new utilities are signing up onto it, and it's growing at similar rates. Trick make it very simple for the consumer, it's a two minute sign up journey, which they do once and they never change. So it's set and forget, absolute transparency. They see when their car was charged and discount they got, and absolute control to the consumer, so they can always press a button and overwrite the utility. That's been one incredible way of driving, driving this journey. This the second one, slightly different but relevant, is, I'm sure nimbyism is a fairly common term these days. Oh, too much. Yes, yeah. Octopus energy wanted to test if NIMBY we can overcome nimbyism. So they went ahead and bought two wind turbines, about a megawatt each, in rural parts of England, and set to communities around their area look, and this is rural communities, the ones that really don't want to wind turbines, but they said to them, these are your wind turbines. They call them your fans. If you sign up to the fan club and your fan is spinning, yeah, if your fan is spinning, you'll get a 20% discount.

 Nico Johnson  38:01

Total gamified. They gamified the process. Oh my god. And if it's

 Devrim Celal  38:05

spending really fast, you'll get a 50% discount. And you know what? You don't have to go look out the window. We'll give you an app that shows, right now, how fast it's turning. And in fact, we'll give you a forecast of how wind is going to be the next 48 hours. So if you want to shift the time when you're washing you can do so those two programs have been incredible consumer darlings. People flock to them. They've been successful because they had a couple of fundamentals. It had the consumer's best interest at heart. It gave them a clear, tangible benefit, and it gave them absolute control to the site not to participate. But as a result, they participated in numbers, and they stuck with it. So I think the biggest change to the system is that consumer Centricity has to be the first objective that we need to go after. When the fan club took off, octopus said, here's a website, and they called it winder.

 Nico Johnson  39:01

I want to meet your octopus marketing team. They are genius. Oh, my God, they are winder. Go for

 Devrim Celal  39:06

it, winder. And they said, Look, if you would like to have a wind turbine your community that you can get cheap electricity from, put your address on this map. And they got over 40,000 communities saying, Yes, please. Then they did the matching, which was, if you've owned land anywhere in the island, put your land here that you would want someone to build a wind turbine on. And matching that, supply and demand, the whole country lit up and to demonstrate how easy it is to put up a wind turbine. Octopus commissioned first one, then the second wind turbine, which they would send to events. So if you have a music event like Glastonbury, they would pick up the wind turbine and install it in the in the heart of the festival, and generate electricity for the festival. And this is the marketing genius. The first turbine was called gusty Springfield. Second one is called fanboy slim.

 Nico Johnson  40:02

I Okay, I've never, I've been in this industry for two decades. I'm such a fan of like, clever, even tongue in cheek marketing, especially if you can tie it to entertainment and music, you're blowing my mind here. Devram, I'm, I think,

 Devrim Celal  40:19

yeah, I think the fan club name gusty and fun boy slip are all internal competitions, so the team gets the credit for them. That's amazing.

 Nico Johnson  40:29

Oh my god, kudos to the octopus team. I love I love this. These stories are fascinating, by the way, and it's instructive for us. Like, if you're a developer listening to this, like, take note. This is stuff that we can do right now, like you don't need a huge marketing budget or push you just need to think differently about how to be clever and introduce wonder and intrigue in the process. Debra, I want to back out to sort of a grid level here, sure, often, often, and especially with software. You know, Google's a great example, Facebook as well. These kinds of like business plays turn into a winner takes most kind of market, right where a few coordination systems dominate. Do you see that there is appetite for there to be a lot of different players the way we see, perhaps in social media, or does the nature of managing electrons sort of insist or insinuate that there is going to be a really small, kind of consolidated orchestration layer, the way we see it in the utility system right now?

 Devrim Celal  41:35

It will depend on the market structure a little bit. I'll give you how I see it and try and articulate where I think it's going, and I'll probably be wrong, but we've got some

 Nico Johnson  41:44

receipts here to prove it.

 Devrim Celal  41:48

So if you, if you think, let's think for a second. Liberalized markets, so competitive markets like airco to Texas, where you have multiple electricity retailers in those markets. I think a vertically integrated SaaS model like Krakens would eventually have us somebody else, someone the dominant market share, because players tend to gravitate towards one player. And if you look at examples of other SAS, vertical integrated SAS players, you would see that there will be one, number one and number two would be exactly. Number two would be quite a ways behind and a long tail of other players. So that's what history of different markets tells us how it should shape up. And if you look at Kraken today, UK of our two products, the customer management and flexibility products, customer management is close to 60% market share, flexibility on large scale, batteries, we are 65% and consumer Plex we're similar. So we got one example, and that's repeating in some other liberalized markets. When you look at regulated and vertically integrated markets, they're slightly different picture depending on which geography you're in. So in the US, naturally, because of the way demand response has shaped up, you have each utility would have anywhere from three to four to 10 plus demand response programs often instituted by different aggregators, OEMs or tech providers that give that as a service to the utility, I think, and I'm writing the script here into the future, that model will change because it's sub optimal, because you would have a thermostat program to solve A grid congestion problem, or a managed charging to solve a bulk problem, a capacity problem. But your problems in the modern grid with solder intermittency, your problems change throughout the day, so the problem you conceive to aggregate those devices for may not be the most important one on a given day. So what I forecast is there will be another layer to help orchestrate all those programs to use them more effectively for the need of the utility at that moment in time. Now, if that goes further, to say a single player starts aggregating all the devices stand alone. I'm not sure if we'll get there, but I could easily see that layer above coming into market.

 Nico Johnson  44:24

I want to give people a sense of scale. So running the numbers really quickly here, five kilowatts, 200 million devices, is a terawatt. Okay? For folks that that's 1000 gigawatts, that's a million megawatts. Okay? Million megawatts. I'm going to put this into perspective for you, and then we can talk about like, I hope that this helps land why an orchestration layer is necessary. And not only that, the massive shift that we're going to see in what a what the grid needs and what the grid looks like. Because what the grid looks like is now 200,000,005 kilowatt devices at the end of the grid, rather than one. Rather. Than, I'll say exactly, rather than. What would it be? It would be the equivalent of 200 Vogel nuclear plants. Okay, this Vogel nuclear plant powers roughly three to 4 million homes. Like just take a minute to think about that. One terawatt divided by roughly five gigawatts the Vogel plants, 4.7 is 213 Vogel nuclear energy plants. So we have the equivalent of 200 plus nuclear plants at full production, like full time capacity in grid edge devices. How are we going to manage that? And also, what an awesome problem to have. We don't have to go build 200 nuclear plants.

 Devrim Celal  45:41

It's a champagne problem, yeah, and I think the first step get consumers engaged, they need to be part of it. It's not that hard, because when someone buys an electric vehicle, we call it the gateway. Gateway purchase, suddenly you care about electricity because it becomes your second largest household bill. Give them something to participate, then change the market structures, change the way you think about managing your grid. Have benefits for changing the time you charge your car, incentivize consumers to be part of it, and then really use these consumer devices in the way you plan the future of your network. We worked quite hard in a few jurisdictions to persuade the system operator, the ISO, to say, I would like to use they should be using consumer devices in critical, critical system decisions. And it's a step towards the world where you have that terawatt of flexibility, and how do I use that? And when the energy crisis, triggered by the Ukraine crisis, Ukraine events started, UK was short on gas. It was a cold winter, we knew that we would have to fire up coal power plants. We still had a few at the time. We don't have any left now, so we took a proposal to the system operator and the government and said, Hey, instead of using those power plants, why don't you pay us the same money, and we will get our customers to use less electricity during those periods. And I know this is something that happens in the US was fairly new, and I don't think in the US is used for critical events. This was absolutely critical, because if people didn't behave, power lights would have gone off. Probably not as critical as that, but it's not too far off. So octopi synergy and EDF and eon, our customers, utility customers reached out to their consumers and said, Hey guys, we think tomorrow at 4pm the system needs your help. At 4pm tomorrow, we need you to help for an hour, and during that period, you would have used two kilowatt hours of electricity, based on what we've observed from your behavior. Reduce that, and we will pay you instead of turning on coal fired power plants. And over 20 events like this, every time the participation went up. And by the end of it, 60% of eligible customers were participating, and they were shouting about it, and they're doing it over and over again.

 Nico Johnson  48:23

This is what I want to know. Actually, is there a built in mechanism through your brilliant marketing team that helps to create awareness that this is working, that customers love it? Like, how did we do that part as well? Because it's like, it's genius to build the mechanism itself, but then you have to give social proof, so that people

 Devrim Celal  48:43

pile on. There's two ways of doing that. One actually showing them the monetary reward, and I'll come back to that in a second. The second one was social media, encouraging people to say, talk about it. So people start writing stories of instead of staying at home, I went to the pub, or I took my dog for a walk, or we had a candle lit lunch, went to bed early. There were many stories coming out, and that sort of was the reinforcing loop to say I've done something. Now. The other thing that we helped our clients figure out was what's the best way of reaching those customers, and that was testing different messaging methods. Do I send them a short message, a WhatsApp, an email, or is it an app push? If I wrote a financial message saying, if you do this, we will pay you. Why? Or if you do this, you will help the system. If you do this, you'll participate as

 Nico Johnson  49:43

part of the group that they respond

 Devrim Celal  49:44

to exactly, and we represent the

 Nico Johnson  49:47

medium and the sentiment, okay?

 Devrim Celal  49:49

And we repeated that in groups of 100. People didn't know they were in a group of 100, of course, yeah, they thought they were part of everything, everyone. Because, yeah, the moment you tell someone they're in a test group, they behave differently. And. Over repetition, for a period of time, we understood what messaging method, which channel and which sentiment worked best, and that was another way of helping scale this up. In the end, it wasn't about the money. In a year of response, million and a half customers collectively made 10 million pounds, so 10 pounds per participant, but that didn't stop them from participating and talking about it.

 Nico Johnson  50:24

Okay, so what? What I'm curious, though, at an at a marketing level, what was the sentiment that moved them, and what was the medium that got the most response?

 Devrim Celal  50:34

The sentiment was participating, being part of a group. So it was a social movement, okay?

 Nico Johnson  50:41

Yes, I'm part of and then, yep, and then the medium,

 Devrim Celal  50:46

the medium, I have to go back and check, I think different customers responded to different mediums. So there wasn't a clear one medium approach. It was a poly channel. It wasn't the app push that always has its problems about permissions. So I think if I was to get it was been short Messages, SMS or WhatsApp or or email. Now a funny story on this month, to close this topic off, is these were usually a day ahead event. So you had 24 hours that you knew about happening. That makes sense. We wanted to see how quickly we can activate consumers to do something, because sometimes an event happens in a much shorter time horizon. So we used WhatsApp. WhatsApp was one of the channels, and we created a group of these people, and with four or six hours ahead, we send them a message saying, Guys, something is happening in four to six hours. Those of you who want to participate, you should respond back to us, right? And within 10 minutes, we had 350,000 people saying we're in No, I love the way. I love your surprise, because most people don't appreciate this until I give them an example. This is like Ticketmaster announcing a Taylor Swift concert. Yeah, that's the kind of response

 Nico Johnson  51:59

in your town. Yep, exactly. I am really sort of taken back listening to the story and over now the multiple phone calls I've had with you just really how thoughtful the institution of Kraken has built the product on top of like, really, what is a people layer? Like, we all know that you have to marshal capital and human resources for an enterprise to be successful. It's clear that you were able to marshal capital resources. The Human Resource side is more about building culture, and it seems to me, like Kraken, from everything I can observe from the outside, is built around just this notion of fun and and and a little bit of instigating and like, and a lot of sort of common shared values that that everyone has bought into, that is the hardest thing I've found as an entrepreneur, to to to build, to to weave into The fabric. What can you tell me about your own journey through upside Kraken octopus of learning how to do that and how does that? How did, how does that materialize in the business that you have now, to me, the

 Devrim Celal  53:14

manifestation of, I mean, behavior gets culture. Manifestation is culture is things that happen as a result of it. And one of the things that I'm proudest, genuinely proudest, is we had 26 people at upside energy when we got acquired. All 26 of them are still here, almost five and a half years after acquisition.

 Nico Johnson  53:39

Whoa, that's very rare.

 Devrim Celal  53:42

And it goes further. There was one chap who said, I will not work at a utility again. And left just before, and he's, he's come back as well in the last year. So he's back into the team. So I can, I can claim 2027 Oh, 2727 now. So yeah, he wasn't seen.

 Nico Johnson  54:04

Yeah, that's lovely. I love that.

 Devrim Celal  54:07

And as a business, we have very low churn rate of staff numbers, because people come here for a mission, and we give them the autonomy to go and do what it takes to achieve that mission. But it was interesting. Over the years of my career, I've done many studies, internal studies, workshops. Sometimes I run them. Sometimes I did them as a service provider to help organizations articulate their vision, their values, their objectives. And here we've always been very clear about the vision statement it was, which was originally used technology to make cheap and green electricity available to masses, or with Kraken that bring green dent impacting people's life positively. And one thing I found quite beautiful was that. Every time you ask someone what the vision statement was, they said something a little bit different, but it meant the same thing. It was almost like yet this hologram, built to last Collins and porous, talks about has to be like a hologram. Whichever angle you look at, it tells you something a little bit different, but it's the same thing, and that sort of you won't find it anywhere, plastered on the walls. People make it their own. And when we looked at our values, the values were it reflected our be, our behavior. So it was being client to obsess getting things done, the rigor, but we criticized ourselves and said, it might as well be a private equity firm's value statements. And we had almost an impromptu session in one of our extended leadership meetings, and someone said, let's make it purple. Let's make purple a value. And at the initial instance, everyone said, that's not a value. It's a color. And we debated it. And someone went on, probably chat GBT, or one of those these days, and said, What's the what's the societal or historic value, or in implications of purple? And it came back as it came back as all the softer things, having fun, enjoying having a light heart, and we thought that really works. So we're not forcing a value. It's actually we just created something quite intangible with the initial starting point that reflected what we believed in. But being a little bit obscure allows us to put more meaning into it, and that sort of really sunk in. Now, we always had the purple plushie, but purple plushie now suddenly has a slightly more meaning.

 Nico Johnson  56:47

Is there anything else Debra from a sort of sewing, like creating the idea of culture in a company that, if you look back over the last not just five years of octopus, but 10 plus years of upside, and maybe even 20 years of your own entrepreneurial journey that you see as something in hindsight, 2020, this is what it this is what it looks like to create a culture that that that keeps people engaged.

 Devrim Celal  57:21

Culture is a harder one to define, because it's not it can't be imposed. It has to be built. And it has to be built from the leadership team setting the boundaries of culture, which is defining the values and living those values and demonstrating that the values are not just words. They have meaning. And in my experience, those really become ingrained in harder times, when you have a hard message to share, how do you behave when you do that? How do you talk to your colleagues when there's good news to share? How do you celebrate together? It's those ceremonious events of, how does your culture bring everyone together? And how do you behave in that environment? I would say two key points where you realize your cultural experiment has worked or failed you, because if it's worked, it's powerful. It gets you through the worst periods of your off the journey of an early stage business. If it hasn't, you just disintegrate because there isn't a glue holding your team together.

 Nico Johnson  58:33

I want to go into a segment we call quick charge, just top of mind, things that come to you, the answers might be short. They might become protracted, that's fine. I'm going to ask just sort of a brief question. You mentioned, either I love Collins, so built to last and Good to Great, seminal reading. Everyone should have them on their must read list. Other books that have shaped how you think about systems and business.

 Devrim Celal  58:55

Not many people may not know this book. Peter sangee, The Fifth Discipline, I very early in my career, I was introduced to the whole concept of systems thinking, and I helped me think of everything I do in causal loops and trying to discover unintended consequences. That helped me, help me plan businesses always looking at, if I do this, what's the causal look that's going to turn this into a virtuous or vicious cycle? What are the levers that I can really, really touch on? It's been part of organism. How do I build organizational structures? The Fifth

 Nico Johnson  59:34

Discipline I hadn't heard of that one. I'm definitely going to be looking into that. And it's the art and practice of the learning organ organization, of course, we link to books in the show notes folks that are that are watching or curious, a founder that you admire,

 Devrim Celal  59:49

Steve Jobs, classic, sorry, cliche. Classic. I go. I go back to his videos, the clarity of thinking, the boldness of women, decision making. And the attention to most in obvious detail that turns out to be so significant is just always a learning.

 Nico Johnson  1:00:09

Yeah, one thing that folks who maybe haven't studied jobs don't realize is how meticulous a prepare or planner he was those keynotes that were seminal, that live on in infamy. He would spend weeks perfecting, and he would start with a blank canvas, and he would tear it up, just like a business plan, over and over and over again. He took every presentation as the as a as a moment then that in his mind needed to be like seminal and like seated in the cultural framework that he was trying to challenge. And I just think, like so often, I'm guilty of this, you know, this through no fault of your own. DevRel, like this interview could be one of those like Steven Bartlett, Diary of a CEO, millions of views, interviews, if I took the Steve Jobs approach and took weeks to prepare for it, right? And had my team think like on how exactly can we distribute this best often we're going so fast that the little, the little micro decisions we make reflect in a way that we may be as unintended consequence on how prepared we are. I am also similarly inspired by jobs and wish. I wish that I had, I wish I had the discipline sometimes that he had. You know, in preparations, there's

 Devrim Celal  1:01:35

another there's another philosophy. And I've heard this from Greg Jackson, founder of octopus energy. Greg often says Greg is an incredible speaker, very powerful presence, and he doesn't prepare. His philosophy is if, if someone goes and reads a red, red statement for a presentation, they might as well emailed it to someone. So rather go talk. And he's always well prepared, because he does it over and over again.

 Nico Johnson  1:02:07

And get across his preparations

 Devrim Celal  1:02:08

here exactly key key messages that people will take away. And once in a while, if you don't get something right, if those key messages landed, that will be what people remember.

 Nico Johnson  1:02:19

Debra, next question, something the energy industry consistently gets wrong. Planning, fantastic, especially planning for the new reality, yep,

 Devrim Celal  1:02:33

let me caveat that my principle of planning is every plan is wrong. Yeah, some of them are useful journeys,

 Nico Johnson  1:02:41

a habit that makes you a better leader.

 Devrim Celal  1:02:44

I learned throughout the journey of upside and Kraken that is inevitable, that I make mistakes. Everyone makes mistakes, but when you're leading the organization and you make mistakes, it impacts a lot of people, and that will never go away. So I've learned to apologize, be open, transparent about things that go wrong. But I I'm one concern with that is that the impression that that gives me license to make more mistakes, and it's a balance that I'm working

 Nico Johnson  1:03:21

on devram. I really have enjoyed our time together. I know that there are folks watching. They in some way want to be in your orbit. Is there a is there an easy way to give folks a way to follow you? How can they connect or sort of follow along in the journey for you and Kraken, what you

 Devrim Celal  1:03:36

guys are about two suggestions, depending on where in the industry you said the easiest one is LinkedIn. We're quite transparent and vocal of what we're doing. Also through LinkedIn, we're quite we publish the events that we participate in, and when I attend, whether it's D tech, Sarah week, whichever event that I'm in, I do pre book some meetings, but also make sure I have ample time at our stand, if you have one to meet new people, because that's over the career, especially early years of the business. That's the that was the best way to learn, to network and build the business. So we try and keep that still.

 Nico Johnson  1:04:14

It's part of our business. We have listeners around the world. Unfortunately, I wish this was going to publish before Sarah week, because I'm sure people would try to book the time with you. I hope to see you in Houston. Still a question mark, what day I'll try to fly out there, but I tell everyone they need to be at Sarah week. Oh, but it's all oil and gas. Yes, that's right, and you should be there. Like, what? Maybe, maybe that's exactly like. Wouldn't it be cool if 100,000 of us showed up? Yeah, where else in the world are you going to be in the like, April, May, June timeframe. Like, where can people think ahead of maybe interacting with your team in person?

 Devrim Celal  1:04:50

June, there's the octopus energy's energy Tech Summit, which is an absolutely incredible event that's in London, Battersea Park. They'll. Announcing exact dates yet, but I will be at Elliot in November, which is the big European utility event. I will most likely be at ei in June.

 Nico Johnson  1:05:14

Again, are you doing any of the like solar, like InterSolar in Munich, or at re plus in

 Devrim Celal  1:05:20

November, definitely re plus, definitely fantastic. Those are typically one day events for me. I go in just meet and catch up with a lot of friends and colleagues and then come back. So thanks. We will not have been back.

 Nico Johnson  1:05:35

Is Europe Devin lives in Europe, and is building, helping build the global team, okay, so many of the folks listening are building technologies that'll plug into our future energy system, not unlike what Kraken is allowing based on everything that you've learned building this business, what advice would you give them about designing solutions that can actually scale in our Energy ecosystem? Start small.

 Devrim Celal  1:06:00

Be ready to fail. Keep persevering.

 Nico Johnson  1:06:03

Devrum, it's great to see you again. Thank you for being with us. Look forward to seeing you again in person.

 Devrim Celal  1:06:10

Nico, it's been a pleasure. Thank you for having me.

 Nico Johnson  1:06:13

Devram Jalal is the chief flexibility Officer of Kraken. Kraken is a platform helping utilities coordinate millions of distributed energy devices, turning the increasingly complex power grid into something that can be managed throughout the world through software. If you'd like to learn more, as DevRel mentioned, you can find him on LinkedIn or in the real world. If you are looking for those links, they're in the show notes for this episode. If you enjoyed this conversation and want to hear more stories from leaders building the clean energy future. Be sure to subscribe and follow SunCast wherever you listen to podcasts, and of course, like devrem on LinkedIn, remember you are what you listen to. Thanks again for showing up. It's half the battle.