Shares 101: A Founder’s Survival Guide
11 September 2025
Starting a company is not just about having a great idea and building a product — it’s also about understanding the foundations of ownership and how to structure it. Shares are one of the most important instruments you will encounter as a founder, whether you are raising capital, motivating employees, or building relationships with co-founders and investors. This blog walks you through the essentials every company builder should know.
Why Shares Matters for Founders?
Understanding shares and stock structures early will save founders time, prevent conflicts, and make the company more attractive to investors. Whether you are preparing for your first employee stock program or negotiating with venture capital, the ability to navigate shares confidently is a hallmark of a capable founder.
What is a Share?
At its core, a share represents ownership in a limited liability company (Aksjeselskap in Norwegian). Owning shares entitles you to a proportional claim on the company’s assets and future income. Shareholders can benefit in two main ways:
Dividends: a portion of profits distributed to shareholders.
Share price appreciation: when the company grows in value, the price of shares rises.
In addition, many shares carry voting rights at general meetings, giving shareholders a say in important decisions about the company’s future.
Share Classes: Not All Shares Are Equal
While the principle of equal treatment applies in most cases, companies can create share classes to provide different rights and obligations. For example, one class may have stronger voting rights, while another might be prioritized for dividends. Share classes are especially useful in balancing control between founders, investors, and employees.
In Norway, shares are often divided into A and B classes:
Class A share:
Class A shares usually carry full voting rights at the company's general meeting. This means that owners of Class A shares have a stronger influence on company decisions, such as the election of board members and other important strategic choices.
Class A shares can have a higher value than Class B shares, especially in companies where voting rights are considered important.
In some cases, Class A shares may also have a priority right to dividends, or to the company's assets if the company goes bankrupt, but this is not always the case.
Class B share:
Class B shares often have limited or no voting rights. This means that the owners of B shares have less or no influence on the company's management or strategic decisions. But no rule without exceptions: The Companies Act (aksjeloven) sets some restrictions that give class B shares the same rights as class A shares.
To compensate for the lack of voting rights, class B shares sometimes have higher dividend rights, or other financial advantages.
Due to limited voting rights, class B shares can be cheaper and more accessible to investors.
Who Are the Shareholders?
Not all shareholders are same:
Founding shareholders: the original company founders.
Employee shareholders: employees who acquire shares, often through stock programs.
External shareholders: investors or companies that buy into your business.
Recognizing these categories helps in tailoring agreements and expectations.
Options and Incentive Programs
Shares and stock options are powerful ways to motivate and retain employees. A stock option gives the right to buy shares at a predetermined price in the future. This can align employees’ interests with the long-term success of the business.
To avoid taxation pitfalls, models such as the Kruse-Smith model provide structures for financing employee share purchases. Equally important is the concept of vesting, where employees earn their shares or options gradually over time — ensuring loyalty and commitment.
Governance: Registers, Certificates, and Agreements
Ownership must be properly documented. By law, companies must:
Issue share certificates as proof of ownership.
Maintain a shareholder register, kept up to date at all times.
In addition, it is strongly recommended to draft a shareholders’ agreement. This regulates the rights, obligations, and relationships between shareholders and provides a roadmap for handling disputes, exits, or new investments.
Building a company is a journey filled with decisions that shape both the present and future of your business. Understanding how shares, options, and shareholder structures work is not just a legal requirement — it’s a strategic advantage. By putting the right systems in place early, you create clarity for founders, confidence for investors, and commitment from employees. In short, getting shares right sets the foundation for sustainable growth and long-term success.
To read more about Kruse-Smith model and shareholders’ agreement, you can visit Lexolve. The information is in Norwegian.
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*Disclaimer: This article is not associated with Lexolve. You should not act or refrain from acting on the basis of any content included in this site without seeking legal or other professional advice. The contents of this site contain general information and may not reflect current legal developments or address your situation. We disclaim all liability for actions you take or fail to take based on any content on this site.
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