It is very common for company owners to start a company without truly thinking about their paid-up capital. In fact, not many company owners know what paid-up capital is. Simply put, paid-up capital is the amount of money a company has received from its shareholders in exchange for shares of stock. Paid up capital is created when a company sells its shares on the primary market directly to investors. In simple terms, the company is offering new shares in exchange for cash. In the secondary market, the shares are traded between investors. Therefore no paid-up capital is created because money is handed to the selling shareholders, not the company.