Oakman Group, the operator behind Oakman Inns and Restaurants and Ashmore Inns, has closed its latest equity raise – receiving applications for £4.4m of shares from almost 300 new investors.

Launched on 11 December, the group was looking to raise £4.5m from the sale of shares to its customers, by 16 February 2021.

Steve Kenee, chief investment officer, for Oakman told MCA there were two reasons for deciding to open it up to investment from its customer base: “The smaller reason was to raise more money, but the main reason was that it was a customer engagement piece.”

He continued: “We operate in affluent locations and have a premium model, and we wanted to engage with people that we know already love our pubs.”

Sold at £2.75 each, there was a minimum investment of 350 shares, equating to £962.50 per person. New shareholders will receive access to exclusive events, new menu tastings, meet the supplier events and an Investors’ Card, which will give them a range of discounts based on the amount invested.

He said the business had always given its investors discount cards, which were highly valued and encouraged them to visit more often than if they were not an investor. However it does not do promotions or discounting as a general rule and so also wanted to be able to reach out to customers with some more targeted marketing, for example around new menu items, he explained.

“Customer engagement by brand advocacy was a huge part of the reason for doing this and that’s the bit we are most pleased with,” he said. “That is what we really want to build on going forwards.

He said that based on the success of this round – with the funds being raised while the pubs weren’t even open – Oakman was “likely” to do another raise of this kind in the future.

The group has historically funded its expansion by raising capital from an extended network of individual investors – it had 200 individual investors before this latest raise – but Kenee admitted there were only so many times you could “fish in the same pond”.

“I knew there would be some challenges – I had to rewrite the IM about four times (due to the changes to restrictions),” said Kenee, adding that while some people were hesitant to invest in a business that wasn’t open, convincing people that it was “a good story” was relatively easy.

“We have a pipeline of sites that we want to develop and we are looking at other opportunities. We want to open more good pubs and develop the business further. We think this is a once in a generation opportunity for growth,” he added.

The group has said it believes it is well placed to benefit from some of changes in consumer behaviour seen in the pandemic, such as working from home, and “the tragic and unnecessary failure of many small pubs and restaurants”.

At the time of the launch the group said it had more than a dozen new sites in its pipeline – most of which would be developed and open in 2021, and that it was aiming to double the size of its existing 28-strong estate by 2026.