What is Minority Discount?

Legal Definition
Minority discount is an economic concept reflecting the notion that a partial ownership interest may be worth less than its proportional share of the total business. The concept applies to equities with voting power because the size of voting position provides additional benefits or drawbacks. For example, ownership of a 51% share in the business is usually worth more than 51% of its equity value—this phenomenon is called the premium for control. Conversely, ownership of a 30% share in the business may be worth less than 30% of its equity value. This is so because this minority ownership limits the scope of control over critical aspects of the business. Share prices of public companies usually reflect the minority discount. This is why take-private transactions involve a substantial premium over recently quoted prices.
-- Wikipedia
Legal Definition
Because a non-owner or minority owner cannot maintain or otherwise engage in the business' operations, this specific type of discount is received by shareholders, company owners of less that 50% ownership, and other non-controlling interests in the assets of a small business.