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If I am holding 30% of shares, does that mean I own 30% of the company?

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Technically, yes.

If you are a shareholder of a company, it means that you own a certain percentage of the company and have certain rights such as attending annual meetings and casting votes.

Essentially, when a person purchases shares in a company for a set price, they hope that the company will gain value overtime and thus lead to a financial gain for the shareholder.

There are two types of shares: common and preferred. The difference between the two are:

Common Shares

Common shares refer to most of the shares that get bought and sold that can have varying dividends over time.

Preferred Shares

Preferred stock refers to equity interests that are paid out a set amount over a period of time.

For more information about stocks, check out my blog: How much stock shares should I authorize when incorporating/forming a company for a single founder?

Additionally, if you’re in the market for some help about how to divide the shares in your company, reach out to us here at LawTrades. We offer a marketplace of freelance attorneys that can help you with all things legal in your business.

Let us know if we can help!