Starting an Ecommerce business ShopifyMonday’s announcement by the company stated that it plans a 10-for-1 stock splitting and is seeking shareholder approval to give a “founder share” to its CEO Tobi Luteke in order increase his voting rights.

Shopify will issue Lutke a non-transferable founder stock to be authorized by shareholders. This gives him a combined voting power of 40% with the Class B shares.

Robert Ashe (Shopify’s independent chief director) stated in a statement that “Tobi is crucial to support and execute Shopify’s strategic vision”

Shopify shares increased more than 1.5% Monday in premarket.

This Ottawa-based firm saw a significant boost in the past two years as it helped small businesses to quickly relocate their operations online after the outbreak. Its stock shot up by about 185% in 2020 and an additional 21% in 2021. The pandemic surge began to fade and shares dropped more than 50% annually.

The proposed 10-for-1 Shopify Class A and B share split is also subject to approval by at least two thirds of shareholders votes. For every share that is held following the June 28th close, shareholders will get nine more Class A or Class B shares.

According to the company, the stock split was done to increase share ownership accessibility for all investors. A number of Big Tech firms include Amazon, AlphabetAnd TeslaSimilar moves were made in the last weeks.

The theory is that a stock split could increase retail ownership because the stock’s lower price makes it more affordable to wider investors. But it does not change the underlying principles of a company or increase its intrinsic value.