Classes of Shares (A, B, C)

Last Updated: July, 2026

A class of shares is a category of a company’s stock that carries defined rights related to voting power, dividend priority, liquidation preference, and convertibility. Companies typically label shared classes alphabetically as Class A, Class B, and Class C, each designed to serve a distinct strategic purpose.

What is a Class of Shares?

A class of shares is a specific type of stock that a company issues. Each class comes with its own rights and restrictions, which are set out in the company’s charter or articles of incorporation. These classes can differ in several ways, including:

• Voting rights: how many votes each share gives in company decisions
• Dividend access: priority or rate at which dividends are distributed
• Liquidation preference: the order in which shareholders are paid if the company is dissolved
• Convertibility: whether shares of one class can be exchanged for another
• Transferability and access: whether shares are publicly traded or restricted to insiders

Many people think that all shareholders in a public company have the same rights. In reality, companies often create different share classes to separate financial benefits from voting power. This way, some investors can own part of the company without having the same level of control over decisions.

Real-World Examples:

Alphabet (Google)	1 vote/share; publicly traded (GOOGL)	10 votes/share; held by founders; not publicly traded	No voting rights; publicly traded (GOOG)
Berkshire Hathaway	Full voting rights; very high price (BRK.A)	1/10,000th voting power of Class A; 1/1,500th economic value; publicly traded (BRK.B)	Not applicable

Key Features of Class of Shares

The company defines the exact features of each class, which can vary widely; therefore, investors need to understand the specific terms before investing.

• Voting Rights: Classes of shares are categories of a company’s stock that differ across multiple dimensions, including voting rights,dividend access, liquidation preference, and convertibility, with each class defined by the company’s own charter or articles of incorporation.
• Dividend Access: Some share classes have priority in receiving dividends or a higher claim on company assets in the event of liquidation.
• Ownership and Control: Companies often use multiple share classes to allow founders or key insiders to retain control while raising capital from public investors.
• Fee Structures (Applicable to Mutual Funds Only): In the context of mutual funds, share classes differ by investor fee structures- Class A typically charges a front-end sales load at purchase, Class B charges a deferred sales fee at redemption, and Class C carries higher ongoing annual fees with no front-end load.

Share Class Types

Companies use share classes to balance the need for raising capital with the desire to retain control, reward specific groups, and tailor shareholder rights. Each class is defined in the company’s charter and can differ in voting rights, dividend access, and other privileges, depending on the company’s specific goals and structure.

Class A Shares

In some structures, Class A shares carry enhanced voting rights relative to other common share classes; however, absolute dividend priority and guaranteed liquidation preferences are characteristics of preferred stock, unless the company’s charter explicitly states otherwise.

In some tech companies, Class A shares are publicly traded with standard voting rights, while founders control Class B shares with super-voting power.

Class B Shares

Class B shares are typically considered “common shares” with standard voting rights (often one vote per share) and no special dividend priority. Usually available to the general public and traded on exchanges. In some companies, Class B shares are the super-voting shares held by insiders, while Class A shares are the public shares—so always check the company-specific definitions.

Class C Shares

Class C shares often have little or no voting rights. It may be issued to employees as part of compensation or to public investors with certain restrictions. Generally more accessible and lower-priced, but with fewer shareholder privileges. In some companies (e.g., Alphabet/Google), Class C shares trade publicly but do not carry voting rights.

Key Differences Among Share Classes

Class A, B, and C shares are categories of stock that differ primarily in voting rights, dividend priority, and accessibility. Class A usually has the most privileges, but definitions can vary; Class B is often the standard public share; and Class C typically has the fewest rights, often lacking voting power.

Feature	Class A shares	Class B shares	Class C Shares
Voting Rights	Typically highest (but not always); may have multiple votes per share.	Usually fewer voting rights than Class A; sometimes one vote per share	Often no voting rights, or very limited
Dividend Priority	Often higher priority for dividends and assets	Standard/common share dividend rights	Varies; sometimes similar to B, sometimes restricted
Ownership/Access	Sometimes reserved for founders, executives, or insiders; may not be publicly traded	Usually available to the public as common shares	Sometimes given to employees or public with restrictions
Convertibility	Conversion from Class A into a higher-vote class is uncommon	High-vote Class B shares commonly convert into Class A shares upon triggering events, making this conversion the norm, not the exception	Varies by company
Price	Can be significantly higher than B or C shares	Typically lower than A shares	Often lower-priced; accessible to more investors

Recording Classes of Shares on Eqvista

If your company has different types of share classes and shareholders, then recording and organizing the details on the cap table should be of utmost importance. Any errors can lead to headaches down the road, as you try to back track on how many shares you issued to whom.

This is where Eqvista comes in. Our advanced equity software management system can help you record all the different classes of shares for your company.

The Summary Page allows you to have an overview of the different classes of shares in the company, and also any options, warrants or convertible notes you may have:

The Eqvista platform also has a detailed page by shareholder to see how much each person owns of your company.

The detailed version also has how many shares each shareholder has per share class, and you can also easily download the cap table to excel.

FAQs

The following questions address practical and regulatory aspects of share classes that go beyond the core definitions, including structural changes, shareholder protections, regulatory oversight, and equity compensation.

Can a company change its share class structure after it has been established?

Yes, but it requires shareholder approval and an amendment to the company’s charter or articles of incorporation. Depending on the jurisdiction, affected shareholders, particularly those whose rights may be reduced, may have the right to vote on or reject the proposed change.

How do share classes affect minority shareholders?

Minority shareholders holding low-vote or no-vote share classes have limited ability to influence corporate decisions, regardless of the size of their economic stake. This makes it especially important for minority investors to review the protections in shareholder agreements before investing.

Are share class structures regulated by the SEC?

The SEC does not dictate how companies design their share classes, but it does require full disclosure of share class terms in registration statements and prospectuses. Investors can review the exact rights of each class in a company’s SEC filings, such as its S-1 or 10-K.

Can employees negotiate which share class they receive in an equity compensation package?

Generally, no. The share class offered to employees is predetermined by the company’s equity plan, which is approved by the board. Employees typically receive a specific class and have limited ability to negotiate the class designation itself.

Interested in different classes of shares for your company?

Share class structures are rarely one-size-fits-all. Whether a company issues two classes or three, the underlying goal is the same: to deliberately allocate rights, control, and economic participation in a way that reflects its priorities at that stage of growth.

For founders, this often means preserving decision-making authority while opening ownership to outside investors. For investors, it means understanding that holding shares in a company does not automatically translate into an equal say in how that company is run.

The labels Class A, Class B, and Class C offer a starting point, but they carry no guaranteed meaning across companies.

For companies building or managing a multi-class share structure, the complexity does not end at issuance. Keeping an accurate, up-to-date record of who holds what is just as important as the structure itself. Errors in cap table management can surface at the worst possible moments: during a fundraising round, an acquisition, or an equity compensation event.

That is where having the right tools in place from the start makes a meaningful difference.

Interested in issuing or managing multiple share classes? Contact Eqvista to learn how our equity management platform can support your company’s share structure.