What different share classes mean for owners
For shareholders, the share class determines the influence and rights that come with ownership. Two shareholders may have invested the same amount of capital but have entirely different opportunities to influence the company.
In practice, it is therefore important to look not only at how large an ownership stake you receive, but also at which share class the shares belong to and which rights come with them.
Common types of share classes and how they differ
Share classes differ mainly in voting rights and financial terms.
- Shares with different voting power per share
- Share classes with the same capital value but different influence
- Preference shares with special dividend terms
- Share classes that give priority in a liquidation
- Terms set out in the articles of association
Once you understand the differences between share classes, it becomes easier to judge who actually controls the company and how your ownership works in practice.
When share classes are used in a company
Worth bearing in mind
Share classes are often used when a company wants to raise capital without giving up control. This is common in growth companies, family-owned companies and unlisted companies where founders or principal owners want to keep a decisive influence.
The structure can also be used to attract investors with financial rights, while decision-making power is concentrated in a smaller number of shares with higher voting power.
Frequently asked questions
What is the purpose of having several share classes in a company?
To separate capital from control and adapt the ownership to the company's needs.
Are different share classes common in unlisted companies?
Yes, they are very common, especially where founders want to keep their influence.
Can share classes have different dividends?
Yes, some share classes can have priority to dividends or special terms.
Where are the rights of the share classes set out?
In the articles of association, which state the voting power and other terms.
Do share classes affect the value of the shares?
Yes, shares with higher voting power or special rights can be more attractive and therefore be valued higher.