Nobody Talks About the Real Numbers
Most articles about tokenization or fractional securities describe the process in conceptual terms. Form the SPV. Draft the PPM. File with the SEC. What they rarely include is what each of those steps actually costs.
I am going to lay out the real numbers based on our research across multiple service providers, legal counsel consultations, and platform evaluations. These are ranges, not quotes. Your specific costs will depend on asset complexity, counsel choice, and offering structure.
The Line Items
SPV Formation: $2,000-$5,000 A Delaware LLC is the standard vehicle. Filing fees are minimal. The cost is primarily legal counsel to draft the operating agreement with proper investor protections, distribution waterfalls, and management authority provisions.
Securities Counsel (PPM, Operating Agreement, Subscription Docs): $15,000-$35,000 This is typically the largest single line item. The Private Placement Memorandum alone runs 50-100+ pages and must accurately describe the offering, the risks, the asset, the management team, and the use of proceeds. Cutting corners here is not advisable.
Asset Appraisals: $5,000-$15,000 For high-value physical assets, best practice is three independent USPAP-compliant appraisals. The two-lowest average establishes the offering value. For gemstones, add GIA certification at $100-$500 per stone.
Institutional Custody Setup: $5,000-$15,000 Bonded vault storage with a recognized custodian (Brink's, Malca-Amit). Includes initial transport, inventory verification, and insurance setup. Ongoing custody fees are separate.
Broker-Dealer Engagement: $5,000-$15,000 setup + 1-7% of capital raised A FINRA-registered broker-dealer supervises the offering, manages compliance, and may provide investor transaction infrastructure. Dalmore Group, North Capital, and Rialto Markets are active in this space. Setup fees vary; the percentage of capital raised is the larger ongoing cost.
Investor Verification: $50-$500 per investor Under 506(c), every investor must be verified as accredited. Third-party services like Parallel Markets (formerly Accredify) charge $50-$100 per verification. CPA or attorney letters run $250-$500. The SEC's March 2025 guidance allows self-certification at $200K+ minimums, potentially eliminating this cost for higher-minimum offerings.
Transfer Agent: $5,000-$10,000/year Manages the cap table, processes transfers, and maintains shareholder records. KoreConX offers a free base platform; traditional transfer agents charge annual fees.
Investor Portal Technology: $5,000-$15,000 Online subscription flow, document delivery, e-signature, and investor dashboard. DealMaker, KoreConX, and Securitize all offer this functionality at different price points.
Marketing and Advertising: $10,000-$30,000 Landing pages, content marketing, LinkedIn ads, webinars, conference attendance. Under 506(c), you can advertise publicly, but the quality of materials matters. Cheap marketing signals cheap operations.
Insurance: $5,000-$15,000 Errors and omissions coverage for the manager, plus specie insurance for the physical asset. Coverage amounts depend on asset value and offering structure.
Blue Sky Filings: $2,000-$5,000 State-level notice filings required in each state where you sell. Filing fees vary by state. Some states require additional filings or disclosures.
Form D Filing: $0 The SEC does not charge a fee for Form D. The filing itself is a notice, not a registration.
Total Range
Adding it all up: $80,000 to $150,000 to reach offering launch, before a single dollar is raised from investors.
For a $5 million offering, that represents 1.6% to 3% of the raise in upfront costs. For a $10 million offering, it is 0.8% to 1.5%. For a $1 million offering, it is 8% to 15%, which starts to strain the economics.
The practical minimum offering size for a full 506(c) structure is roughly $3-5 million. Below that, the fixed costs eat too much of the raise.
Where to Save (and Where Not To)
Marketing costs drop if you start with organic content before paying for ads. Simpler portal solutions cost less than full-featured platforms. Two appraisals instead of three saves money, though three remains best practice.
Do not save money on securities counsel. Do not save money on custody. Do not save money on compliance. These are the areas where cutting corners creates regulatory risk, investor distrust, and potential personal liability.