Supervoters in Silicon Valley: All About Dual Class Voting Structures

That’s the ratio that describes the voting structure at most companies: one share to one vote. An investor who owns one share may cast one vote, an investor who owns 10 shares may cast 10 votes, an investor who owns 100 shares may cast 100 votes, and so on on everything from board member elections to ballots on whether the company should be sold. But that is only true in the so-called single class share structure. In recent years, some high-profile IPOs have drawn attention to an alternative type of voting structure: dual class voting structures. Under dual class structures, certain shareholders get more voting power than others. The “supervoters,” as some call them, are typically company founders and management. The dual class structure allows them to exercise disproportionate control over the company by allowing multiple votes for every share owned. For example, supervoters might receive 10 votes for every share owned, while ordinary shareholders are still entitled to one vote per share.