Common stock is the basic class of equity ownership in a corporation. It generally represents a residual claim on the company—meaning common stockholders share in the company’s value after creditors and any preferred stockholders have been paid.
Common stock typically includes:
Voting rights (e.g., electing directors), depending on the charter/class
Potential dividends (if declared)
Upside in growth and rights to proceeds in a sale/liquidation after senior claims
Ryan RobertsStartup Lawyer
Ryan Roberts is a startup lawyer with more than two decades of experience advising on venture financings and M&A transactions totaling more than $1 billion. He is the author of the Amazon bestselling startup law book Acceleration.
