Shares represent ownership of a company.
A company needs to make a certain amount of shares available to current and future shareholders.
This is done during the company registration procedure and it is reflected on the company memorandum of incorporation.
When a company is registered these shares can be issued to the respective shareholders.
If a company has 100 000 authorized shares with 2 shareholders, each shareholder will own 50% of the company (50 000 shares each).
Even if at first both shareholders are issued with a total 100 shares (50 shares each).
Each shareholder will still own 50% of the company.
It is recommended that a company starts out with a high number of shares, so that it makes it easier when future shareholders join.