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  From WWW businesslink.gov,uk
  
  Shares and shareholders
  
  What are shares and why are they issued?
  
  Shares represent ownership of a company. When an individual buys shares in your company, they become one of its owners. Shareholders choose who runs a company and are involved in making key decisions, such as whether a business should be sold.
  
  While shares are most obviously associated with the stock market, most small businesses don't go near a stock market in their lifetime. They are more likely to issue shares in their company in return for a lump sum investment. This investment may either come from friends and family or, for businesses that are looking for capital to fund high growth, through formal equity funding finance.
  
  Formal equity finance is available through:
  
  business angel investors
  venture capital firms
  stock markets
  These investors are willing to put up capital for a share in a growth business. The advantage of raising money in this way is that you don't have to pay the money back or pay interest to the investors. Instead, shareholders are entitled to a share of the distributable profits of the company, known as dividends.
  
  Issuing shares in your company on a stock market can provide:
  
  new finance
  an exit for founding investors who want to realise their investment
  a mechanism for investors to trade shares
  a market valuation for the company
  an incentive for staff using shares or share options
  an acquisition currency in the form of shares
  a way to raise your business' profile
  For more information on business angels and venture capital firms, see our guide on equity finance.

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