1 Once upon a time, when you bought broccoli you bought the whole vegetable, stems and crowns. Then it became customary for grocery store produce departments to separate the crowns from the stems and to sell the crowns at a premium. 2  Iâm not a fan of this practice, because I like both parts of the broccoli plant.
A company's first issue of common stock to the public is called an Initial Public Offering. Afterwards, a corporation may issue new equity at any time in order to finance its growth. When new common shares are offered to existing shareholders first, this is called a rights offering.
When a corporation first goes public it creates a certain number of shares. Each of those shares represents a specific percentage of ownership in the company. If 100 shares are issued, for example, then each share represents 1% of the company. After that initial public offering, shares can only be created in one of two ways: a) Issue previously unsold shares.