You’ve bought my razor, now buy my bonds. That’s the message from Will King, entrepreneur and founder of the King of Shaves brand, who today is inviting customers who like his products to back him with their cash. Mr King is issuing 5,000 bonds, denominated in units of £1,000 a time, to raise £5 million to fund the company’s growth plans. The “shaving bond” will pay an annual coupon — interest — of 6 per cent each year over three years.

The bonds, which are non-transferable and non-convertible, have been approved by the Financial Services Authority and the issue is being managed by BDO Stoy Hayward, the accountancy.

Mr King said that it was the first instance, so far as he could tell, of a brand turning to its customers to raise funds. “I had the idea about four years ago. We have always bought interesting domain names connected with shaving and I bought shavingbond.com in about 2004 or 2005. I thought about what I could do with it and that got me thinking about bonds and how they are used by companies to expand the business. I thought it was something I could do in future but then parked the idea.

“Then, last year, when we launched our system razor, the Azor, it came back to me. I had bet on it getting a market share of around 5 per cent, and it’s turned out to have 10 per cent of the ‘handle’ razor market,” he said. The strong demand showed him that there were “thousands of customers out there who really support what we are doing”.

Mr King founded King of Shaves in 1993. Thanks to his sensitive skin, he had always struggled to shave, until his girlfriend suggested that he put bath oil on his face before shaving, which cut out razor burn completely. With a £10,000 bank loan and £30,000 borrowed from two friends, he made shaving oil and filled 10,000 bottles by hand at home. Early stockists included Boots and Harrods. Helped by publicity in lads’ mags, the brand’s profile grew. It used viral marketing techniques and paid $35 for the domain name shave.com in 1995.

The money raised now will be used to build awareness as the brand expands internationally. Mr King said that he could not predict demand for the bonds, which could be a precursor to an initial public offering in four or five years’ time. “My gut instinct tells me it will be heavily oversubscribed. I don’t want to raise £50 million, though, I wouldn’t know what to do with it. This is as much as we need right now.”

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