Article
How much does a reverse merger cost?
A reverse merger typically costs $400,000 to $600,000 all-in. A decent public shell is typically about $300,000 of that; legal, audit and other fees make up the rest. The shell's existing shareholders also keep part of the company. Many founders expect it to cost much less. It usually doesn't, which is why we recommend a reverse merger only when speed truly matters.
Joel Arberman, Meraki Partners · Reviewed October 2026. Based on 17 companies taken public since 1999: 11 by direct listing, 4 by reverse merger and 2 by IPO.
What makes up the cost?
| Item | Typical cost |
|---|---|
| A decent public shell | Typically about $300,000 |
| Legal, audit and other fees | The rest of the $400,000 to $600,000 total |
| Equity kept by the shell's shareholders | A share of the combined company |
Why not buy a cheap shell?
A very cheap shell usually has problems: unknown liabilities, contingent liabilities, unclear share records or bad actors in its history. Those problems become yours after the merger.
How does it compare with a direct listing?
A direct listing typically costs $300,000 to $500,000 with no shell and no shareholders to buy out, but takes about ten months instead of six.
When is the extra cost worth it?
When speed truly matters, such as when investors are ready to invest and might be lost to a few extra months. We have used reverse mergers for 4 of the 17 companies we have taken public.
Can the cost come from a raise?
Yes. Like a direct listing, the costs are usually funded from a private placement raised from the founder's network.
Related questions
Want to talk it through?
Tell us where you are, and we’ll set up a first conversation about whether going public belongs in your plan and what it would take. If it isn’t right for you, we’ll say so.