Simplified joint stock company
In one sentenceA form of joint stock company with simpler incorporation and management procedures, which may be founded by a single person, suited to startups and entrepreneurs.
Simply put
The Companies Law introduced it to provide flexibility: bylaws set by the founders with wider freedom in management and the allocation of powers, while liability remains limited to the value of the shares.
It is often used by startups because it makes it easier for investors to come in with shares and different share classes. The details are in the Companies Law and its regulations.
Example
Two programmers founded an app and expect investors to come in over several rounds, so they chose a simplified joint stock company: new shares are issued for each investor, and the management method is set in the bylaws without the complexity of a traditional joint stock company.
Don't confuse it with
Limited liability companyThe capital of a limited liability company consists of stakes whose transfer is restricted, while the simplified company's capital consists of shares that make it easier for investors to enter and exit.