Preferred Stock 

Preferred Stock is a class of equity security that has preferential rights over common stock in areas such as dividend payments and asset distribution upon liquidation. While it typically lacks voting rights, preferred stockholders receive: 

• Fixed or cumulative dividends. 

• Priority over common shareholders during asset distribution. 

• Special rights in fundraising events (e.g., anti-dilution, liquidation preferences). 

In venture financing, preferred stock is often issued to investors, offering them downside protection and greater influence over critical business decisions.