This is a common situation that can occur in any form of poker. A Multi-way pot comes into play when there are more than two suitors for the pot in a round of poker. In such a way, there is a possibility that the winner of the pot can be more than one of two people.
A pot can be said to be multi-way at any point during the round and not necessarily before the showdown. However, at the very first round of betting, before the flop, everyone at the table might be a part of the pot and therefore, at that point, the pot is not said to be multi-way. Basically, a pot is said to be multi-way only after a few actions or bets, with some people folding out. There is no distinct stage for marking the beginning of the phase from which a pot can be labeled as a multi-way pot.
However, a multi-way pot should not be confused with a split-pot where there might be more than one winner. A split pot occurs after showdown between two or more players however, a multi-way pot is a term used to describe the pot when there are more than two players still competing for it.