Dual-Class Shares
A share structure with two classes carrying different voting rights, often used by founders to retain control.
What is Dual-Class Shares?
A dual-class share structure creates two or more classes of common stock with different voting rights per share, allowing founders or controlling shareholders to retain majority voting control even after selling a substantial economic stake to the public. Class A shares (sold in public markets) typically carry one vote per share, while Class B or super-voting shares (held by founders) may carry 10 or more votes per share. Notable examples include Alphabet, Meta, and Snap. Critics argue dual-class structures entrench management, reduce board accountability, and insulate founders from legitimate activist pressure. Proponents contend they allow founders to pursue long-term strategies without short-term market pressure.
Example
When Alphabet (Google's parent) was restructured in 2015, it maintained its dual-class structure — Class A shares with one vote each and Class B shares (held by founders Sergey Brin and Larry Page) with ten votes each — plus a new Class C share with no voting rights. This structure gave founders supermajority voting control despite holding a minority economic stake.