We started Cuckoo to make broadband simple, for good.
Since our launch last year in July, we’ve been building and tinkering to create a great experience for our customers. We’ve had some big wins and deep learnings over that time.
So it feels great to today announce an exciting new phase of growth. We’re welcoming two successful investors as shareholders in the business.
What do they bring? Well, there are two halves to our business.

We don’t own the broadband wires, instead it’s our job to make sure the experience coming out of them is great. So we’re building software that can scale. And it’s in backing software businesses that RTP Global has some impressive experience which will come in useful! One in five of RTP’s investments are now ‘unicorns’ and often go on to list on stock exchanges in Europe and the U.S.

We’re building a consumer challenger brand. This is where JamJar come in. They are created by the Innocent drinks founders’ and have backed some great brands such as Bulb, Deliveroo, Tails and Oatly.

We’ll use this new investment to reach more customers and hire even more great people so we can build useful tools for customers.

So if you know anyone who might want to help build something new, give us a bell.

The Telegraph: Innocent Drinks founders back broadband start-up taking on BT

City AM: Broadband startup Cuckoo closes $6m funding round

TechCrunch: Insurgent UK broadband startup Cuckoo Internet raises $6M round led by RTP Global, with JamJar Investments (also syndicated on Yahoo! Finance)

Sifted: Meet the ex-Bulb PR creating the Bulb of broadband

UKTN: Challenger broadband provider Cuckoo raises £4.3M to free users from expensive internet services

Tech.eu: Investors go Cuckoo, pour $6 million into UK’s flat-rate broadband provider

Why we raised a $6m investment round

We raised these funds to grow our team and reach more people

Words offer the means to meaning, and for those who will listen, the enunciation of truth. And the truth is, there is something terribly wrong with this country, isn’t there?

There is something terribly wrong. These are Alan Moore’s words from V for Vendetta. Greed and power overtook justice in Moore’s vision of Britain. Greed and power still grip the pockets of millions today.

Loyal customers are being ripped off. Banks. Insurers. Energy firms. Mobile networks. They all do it. The longer you stay, the more they charge.

The wave of consumer disgust is birthing great businesses. High street banks created Monzo. Big Six energy firms created Bulb. Staid and dreary is turning into bright and cheery. But another piece of the puzzle remains.

The broadband market is broken. Complex deals. High Prices. Bad Service. The broadband ‘loyalty tax’ now stands at £1.8 billion every year. But it does not have to be this way! Simple deals can work. Cheaper offers are possible. And smoother service is needed.

That is what we are here to do. Cuckoo will offer smooth and simple internet. One simple deal. Fair prices. And great service. The internet is magical. We’ll return it to what it should be.

But we need your help. We can’t do this alone. Join us on our mission to make the internet more magical.

P.S. We confronted the biggest broadband company’s CEO and asked him why loyal customers are paying more than anyone else. He said he was ‘very confident’ that no one would challenge him…

How many broadband customers are on out of contract tariffs, and what will the impact of Ofcom’s end-of-contract notifications be on churn?

And, kind of allied to that, just as Bulb and Monzo have set off a wave of disruption in the energy and banking retail markets, do you expect or see anything similar in retail broadband markets, with 95% market share of the big 4?

The out-of-contract, front-book back-book price differential topic is really really fundamental. With both mobile markets and fixed. So we’ve made a lot of changes over the last 9 months or so in terms of both those types of products. If you look at EE, for example, just as a good sort of benchmark, all our customers are notified well before their end-of-contract date appears, and without sharing our numbers which are market leading, the conversion rate to a next tariff is very, very high. And that is really important, that they feel satisfied with when they end a particular contract, they move to something that meets their needs. Because people’s needs do change — often they’re part of families, kids, all those kinds of things.

So that’s sort of the benchmark for us. We’re moving to the same model in BT broadband for all the country actually. And we’re testing various ways of doing that. And obviously what you need to do is make sure that the customer gets the best proposition for them. And we have lots. There are very, very many variables for our customers. So I think come the first quarter of next calendar year, we’ll have tested all our different options, and we’ll be in the marketplace with a very very strong out of contract proposition that migrates people to the best contract for them. And, by the way, it’s not always the lowest price.

But if you have a differential between in-contract and out-of-contract, that’s purely a loyalty tax on people who stay for longer, and just don’t realise they’re on an out-of-contract rate.

Well as I said, when they’re on a mobile, when they’re out of contract, they’re alerted well before time, and the numbers of people who stay with us are extremely high. And when I say extremely high, I mean high nineties. So I’m very confident we’re doing the right stuff there, and we will just roll that thinking onto broadband customers as well.

So you’re happy with loyal customers paying more than new customers who come in?

I didn’t say that. I think it’s really important to make sure that all customers get the best value, and there are so many different tariffs, as you know. We are — and I said it in my earlier remarks — we’re trying to simplify our propositions so customers can easily compare and contrast our offers, let alone other people’s offers. So comparing and contrasting is really important in a competitive market. And as I said before, you will see new stuff from BT which is very competitive, in every sense of the word. And it will be value for money for our customers.

Broadband is broken. Complex deals. High prices. Bad service. Join Cuckoo to make the internet more magical.

There is something terribly wrong

This is the story of Cuckoo and the creation of our brand. Nice to meet you.

Introducing Cuckoo; an internet company founded on the principle of transparency.

Broadband is broken. Complex deals. High prices. Bad service.

The broadband ‘loyalty tax’ now stands at £1.8 billion every year. But it doesn’t have to be this way. Simple deals can work. Cheaper offers are possible. Smoother service is needed.

So here we are. Cuckoo offers transparent pricing and outstanding service. One simple deal. A rolling contract. And easy to deal with. The internet is magical. We’ll return it to what it was meant to be.

From the Burger King car park where Alex and I first chatted about Cuckoo, through to the evolution you see today. This is the story of how it all came to be.

Before building Cuckoo, I was the Global Design Director & UX manager in the Customer Experience Team at Nissan. Over the last 12 years, I’ve had the privilege of influencing products loved and used by millions. Brands such as Sky, Jaguar Land Rover, Formula 1, The National Trust, and J.K. Rowling’s Pottermore. Building up a company’s identity was not new to me, however, doing it ourselves, without a team of creative warriors alongside me was daunting. Often a project like this would span 3–5 months and involve up to a dozen specialists; art directors, strategists, copywriters, and designers. This was a daunting task for a small group, but much more fun than we could have ever imagined.

You can go your own way. You can call it. Another lonely day. You can go your own way

I still remember the cold November evening in 2018. Friends from a previous life, our CEO Alex and I were sat in a van eating cheeseburgers and he flirted the idea of a broadband company based on good morals. I turned to him and said ‘the name Cuckoo’s got legs!’. I spent 6 weekends and 15 late evenings cobbling together our original brand playbook; CuckooAlpha. We won over many people with that deck. Perception is everything.

On 3 February 2020, Dan (our Head of Tech) and I quit our jobs and joined Alex full time. Today, just over 8 weeks later we are proud to reveal what’s been going on behind the scenes whilst we build Cuckoo; a broadband company that even your mum would be proud of.

One of the perks of starting your own business is you can bring in the best people to help you and move very fast. As long as they share your “hell yeah!” attitude about good broadband to the masses. And that’s how we were lucky enough to bring on my school friend Ed Newton aka Sheddy; the super talented designer of household favourites; House of Fraser and Sainsbury’s.

So we spent time trying to understand what was wrong, really wrong. In order to really immerse ourselves in what we were up against, we went radical with our research. Obviously we conducted the usual primary and secondary, quantitative and qualitative research. However, we also gatecrashed a competitor’s AGM. Emailed the executive leadership teams of the big guns. We even helped customers of our competitors with their connectivity problems. Is it weird to help your competitors' customers? Maybe. But that’s our style.

The telecoms landscape is full of industry jargon and confusing language. We are in a sector where every provider claims to havefast,super,unlimited, essential, ultrasuperfast,superultrafast, unlimited essential ultra superduper plusproducts which cause confusion, doubt, and mistrust. You still with me?

An ASA report from 2017 found fibre was one of the “many buzzwords to describe modern, fast broadband”

Our key takeaway? Be transparent and truthful.

From day one we’ve strived to incorporate customer insights into the decisions we make. We partnered with a polling company to get the opinions of over 4,000 people.

And we kept asking: What do you want from broadband? What do you think of your current provider? What makes you stick around? What makes you leave?

At the start of 2020, our waiting list rocketed to over 1,000 people. We’ve been using these wise folk to bounce ideas off, validate our assumptions and help shape our product strategy. We love getting emails from people around the country asking when can they switch, for good.

“We didn’t build the Mac for anyone else. We built it for ourselves”

By listening to our customers, we realised that people often refer to broadband with words like “untrustworthy, rip-off, corporate.” That’s some pretty negative vocab to blanket an entire industry, right?

Our solution: a shift toward something simple

A radical one for the sector — contemporary, engaging, fun and audience-led. Cuckoo is an independent team, taking on the big guys and speaking to our customers in one voice across all platforms and channels.

The Cuckoo logo; the tale of chicken and the egg.

The brief we set ourselves for the logo was that it had to be bold, iconic and contemporary. We wanted to create a brand that felt alive and echo’ed connectivity. A digital-first identity — one you’d expect from an internet company.

The first concept was the obvious road of exploration; a bird metaphor. The problem is, the Cuckoo bird is a rather unfortunate looking bird. All of God’s creatures are beautiful, other than the Cuckoo bird it would seem. Challenge accepted we continued to explore a number of cliche bird metaphors. Over 131 different bird variations were discarded; to be exact.

When designing a logo you often want to reduce the detail to the absolute minimum, whilst ensuring it’s still recognisable. We soon learned that to make a distinctly identifiable bird you need to show at least 3 of their 5 key characteristics; the beak, wings, tail, eyes, and body. Otherwise, you quickly end up with a seal, worm or bumblebee. It’s that or, it ends up like the Twitter logo. Every. Single. Time. We soon wrote off a bird and moved on.

Conceptually Ed and I knew we wanted to portray the feeling of connection. After all — the internet is at its core, all about connecting people. Every route we explored to date was either too complex in nature or just plainly didn’t feel right.

If an egg is broken by outside force, life ends. If broken by inside force, life begins. Great things always begin from inside.

The second concept, we wanted to represent being connected by integrating pulse lines commonly associated with WiFi. We then combined it with something simple and pure; an egg. We diligently explored every type of egg style and shape (46 to be exact) until we settled on something simple and memorable. A brand mark that feels unique and ownable, having meaning at its core.

The telecoms industry is crowded with shades of utility purple, dashes of corporate blue and a sprinkle of blood red. In a saturated market (pun intended), the new kid on the block needs to stand out.

We’re competing with the big guys via pixels on your screen. We want those pixels to shine bright.

We have used Palanquin — a Google font developed by Pria Ravichandran, a type designer from India.

Palanquin is a Unicode-compliant Latin and Devanagari text type family designed for the digital age. The Devanagari is monolinear and was designed alongside the sans serif Latin.

The Palanquin font family is versatile and strikes a balance between typographic conventions and that bit of sparkle.Perfect for Cuckoo. The typeface renders beautifully at all sizes, especially on screen. As a brand, we want to ensure we’re taking responsible steps to reduce our carbon footprint so it is less important how it prints; we won’t be big paper wasters. Paperless billing will mean that almost all of our customer's interaction with us will be online. A font designed for the screen was a natural choice.

What are the words that you associate with talking to your broadband company? Corporate, untrustworthy, stale, boredom, waiting are just some of the words we heard when we spoke to people about the broadband industry. So much of our business is founded on how our customers feel about being on our network.

This is how we talk. This is how our Eggcellent Experts will sound whether you are chatting to us on WhatsApp, text, email or over the phone. And we promise not to actually say that.

After being told by top London agencies it would cost upwards of £75,000 to develop our brand; we decided to embrace the challenge and keep it in-house.

They quoted us £75,000, so we did it ourselves: the Cuckoo brand story

When it comes to pricing, the current crop of providers aren’t doing a great job. This isn’t just me saying so: criticism has come from, among others, the likes of The Times, The Daily Mail, The Mirror, The Daily Star, The Daily Telegraph, The Sun, The Guardian… unanimous support across the press spectrum that politicians could only dream of. In short, the broadband market all too often reflects a broken, oligopolistic market.

First of all, anyone who’s gone on a broadband website will know that there are a ridiculously large number of deal options. TalkTalk, for example, have five different deals on their website: Faster Fibre, Superfast Fibre, Faster 150 Fibre, Fast Broadband and Ultra Fibre Optic. That’s before you get onto their call packages (Unlimited UK Calls or International Max), TV options (would you like TalkTalk TV, TalkTalk TV Box, TalkTalk TV Plus Box, TalkTalk TV multi-room, TV Select, TV Entertainment, TV Kids, or Sky Cinema) and choosing between the Super Router and All new Wi-Fi Hub. By my calculation that’s 360(!) different potential combinations of deals. No wonder we find it hard picking the right one for us.

But even when looking at a single deal, prices are opaque and difficult to understand. In a study by the Advertising Standards Authority, only 23% of individuals were able to correctly identify the total cost per month of a broadband deal when looking at an ad for the first time. The vast majority were left confused and misled. It’s no wonder that we end up on expensive and complex contracts.

Ofcom estimate that 8.8 million households in the UK are paying around £100 per year more than they should. Why? Simply because they got to the end of their contract and trusted that their provider would give them a fair deal. Instead, the vast majority of current providers hike prices at a contract’s end. It’s a tax on loyalty. At the time of writing, the infamous leader of the pack is Virgin Media’s M50 tariff, which increases by a whopping £192 per year after 12 months. In terms of relative increase, the winner is Post Office’s 11Mbps package, which increases by 67% 12 months in. Lovely.

Every day 25,000 broadband customers come to the end of their contract — and the majority of those see an automatic price rise.

Some plucky individuals will read the above and decide to raise it with their provider. Good luck to you. Negotiating a new deal is protracted, complex and painful. First, you might have to navigate your provider’s website to even find a way to contact them — no mean feat, since many providers make it as difficult to get in touch as possible. Then, having waited in a call queue for an hour or so, be prepared to listen to various explanations as to why you, as a loyal customer, are not allowed to receive anywhere near the same deal as new shiny customers who want to join for the first time. You may then generously be offered a pound or two off your current price, still likely far more expensive than introductory offers.

Perhaps instead you need to leave your contract early. There can be valid reasons; we get that people’s plans change. But most providers don’t agree, and instead charge exorbitant fees if you need to leave — far above what anyone could consider reasonable. Our CEO’s dad was trying to leave BT and was threatened with a £400 fine for ending his contract early. Want to challenge the fine? See above.

Thankfully, we are seeing progress. In the past Ofcom have fined EE and Virgin Media millions for levying excessive charges to customers who ended their contracts early. And Ofcom are now requiring companies to tell customers about their best deals when they reach the end of their contract. At least, they were just about to - until Coronavirus hit and they decided to delay enforcement.

senior executive at a top 5 UK ISP, May 2020

“We know charging loyal customers more is unfair and not nice, but we make billions from it. It’s a battle between the commercial and strategic arms of the business”

But we think that change is always best when it comes from the industry itself. From the bottom-up. It shouldn’t be the regulators job to require us to treat paying customers with respect.

And so when we set up Cuckoo, we wanted its approach to be distinctive. Refreshingly distinctive. But what exactly would that look like?

We started by setting out the overarching principles that should shape our approach to pricing. These, we resolved, would guide how, what and when we charged our customers.

Be clear. Our customers should know what they’re paying each month, and why. And next month. And the month after that. They shouldn’t be surprised at additional charges or jumps in the price. And they shouldn’t have to wade through dozens of different deals before joining us. Most people just want fast internet that works — and so that’s what we’ll give them.

Be reasonable. We don’t want to take advantage of customers whose plans change for reasons outside their control. Our business model shouldn’t rely on a bunch of customers not noticing or challenging excessive charges. We want people to understand why they pay what they they pay at every stage of the journey with us.

Reward loyalty. Customers that stick with us should be thanked, not exploited. At the very least, they should never get a worse deal than our newer customers; at best, they should be rewarded for being a committed customer.

… And be financially viable. Okay, this one might not be quite as exciting or revolutionary. But at the end of the day, if we don’t cover our costs we won’t be able to keep providing our service. Which doesn’t help anyone. So we’ll aim for a business model that is both sustainable (see our legal duty below) and fair — where each customer pays what they should, and not where a pool of loyal customers cross-subsidise those who like switching onto new contracts. (The incumbents have a euphemism for this — it’s called back-book front-book cross-subsidisation. Catchy.)

These principles provided our framework. But to get to the specific details, we needed to reach out to our customer base.

First, we Cuckoo Community and tested our pricing ideas directly with members of the public. This was great. It wasn’t easy — several people said we needed to rethink our approach. But that was exactly the feedback we needed as we refined our proposition. We got a bunch of ideas that we hadn’t considered, and we got a sense of what people cared about most.

Second, we ran a survey. We tested a bunch of price points against our competitors’ offerings with a group of about 1000. This was costly but it was a great way of getting some aggregated feedback to complement our individual verbatim thoughts from the Community.

“24% of people are more likely to change broadband provider due to Coronavirus”

Third, we built a financial model. We needed to work out what would be sustainable in the long-run under what assumptions, and test different scenarios. This helped us really get to the final answer and manage the trade-off between affordability, financial sustainability and quality of service.

That was our approach. And here’s what we’ve come up with.

One fast speed. One month rolling. No end of contract price rises.

You’ll pay £29.99 each month for your broadband. No fixed contract length; no post-contract loyalty tax. And only one deal (much like Bulb having one tariff). We might need to increase prices in line with inflation in future years (we’ll try not to!), but if it does, it will increase by the same amount for everyone. This monthly price was originally going to be higher, but feedback from our community adjusted this price!

And a £60 connection cost. We thought hard about this. We know that an upfront cost might put off some customers. However, each time someone joins our network we need to pay Openreach about £60 to switch them over; and we’d rather be transparent about that rather than tying you into a long contract. An upfront cost has proved manageable and successful at other companies — like ByMiles. What’s more, we hope to allow you to spread out your upfront cost over time via Klarna. We also buy you a good quality router — but we’ll give that to you for free as long as you send it back to us if you leave 😢.

What’s more, we’ll introduce a loyalty bonus. We commit to rewarding our most loyal customers — those who stay with us for many years. The longer you stay, the price will go down. Being entirely transparent, we need to monitor our financials and churn rates over the coming year before confirming the exact details and the size of our loyalty bonus; but watch this space.

But… our approach isn’t set in stone. This is our best attempt off the back of the work we’ve done and a few weeks of being live. To pivot, is to startup.

Think there’s a better approach? Great. Tell us. 🔊 We’d love to hear what you think, and consider whether it works for us. Contact us at hello@cuckoo.co or join the conversation on Twitter.

Why we raised a $6m investment round

Software

Brand

Press

National media coverage

Regional media coverage

Industry media coverage

More from Cuckoo

There is something terribly wrong

They quoted us £75,000, so we did it ourselves: the Cuckoo brand story

How to disrupt a £12bn industry; the Cuckoo pricing story

How fast can you go?