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How to become a shareholder: 3 ways to get there

Company shareholder tips

When you are looking to invest your money so that you can get a return, there are many options that you can consider. Buying into a business, whether it is on your own or with the help of a broker, lets you reap from their success as you support their operations with your cash. Here are a few ways that you can become a shareholder in a corporation.

1. Becoming an investor

One option to become a shareholder in a company is to invest in it. Like Ralph Thurman, a leading executive in the pharmaceutical industry has done, you can purchase a portion of a business directly instead of going through a third party.

Reach out to a member of the management team, such as the owner themselves, and ask what a share of their organization would be. If they are willing to sell to you, they will give you a price for your portion.

Then, you send a payment to them and they will, in turn, send you documentation that states your ownership. You will also be listed in their official paperwork as an investor and have an opinion on the operation of the facility.

2. Work with a broker to become a shareholder

When you work with a third-party brokerage or broker, you can invest in multiple corporations and see a return from several types of companies. These individuals collaborate between you and the business with the stocks for sale to determine a price for it then organize the final transaction.

They will add their fees onto this amount to ensure they are compensated for their efforts and these charges will vary by the stock that is being purchased and the group that is involved in the process. They will also sell off anything you already have if you want your cashback or have interest in another industry.

Types of brokerages

There are different types of brokers that you can work with to get your investment made. You can research companies online that will handle this for you and purchase the stock that you are interested in.

The fees to work with them are usually cheaper but you have little say in what corporations you will be buying from. Another option is to work with a full-service business that will meet with you and document what you are looking for.

They will personally make the transaction with organizations you are interested in and facilitate the process for you. However, you will pay more for this service. There are situations where they may offer a discount, especially if it is a long-term or a gift for someone else.

3. Stocks on the market

There are three types of stocks to invest in if your goal is to become a part-owner in a particular business. When a company wants to expand, they will offer a growth version, then use the money they receive to increase the size of their organization.

If they want to use the cash for profit, including paying the owner and management staff, it is considered the income stock option. Businesses can also have a combination of the two if they need to add on to their corporation yet want the investment into their bottom line, so that is the third type of stock.

A few last words on being a shareholder

With even just one share, you can become a shareholder. Once you do so, you reap the benefits of success that the organization has, and that can bring in welcome income.

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