By Donny Shimamoto, CPA.CITP, CGMA
Inspiration Architect, Center for Accounting Transformation
The accounting profession is in the midst of a seismic shift. Private equity (PE) is reshaping firm ownership structures, consolidation is reaching down to smaller firms, and partners nearing retirement are asking: Who will take care of my clients?
In the face of these changes, many feel like the choice is being made for them. But that doesn’t have to be the case.
Understanding the Landscape
Accounting Today recently reported that private equity and venture capital-backed deal value in the accounting, auditing and taxation services sector was more than $6.3 billion in 2024—the most since 2015, based on S&P Global.
The promise of capital infusions, advanced tech stacks, and streamlined operations is enticing. Because of this, M&A activity is climbing. The AICPA reports that firm consolidations have doubled in the past three years.
Add to that the talent shortage, succession planning crises, and growing client expectations—and it’s no wonder firm owners are at a crossroads.
The Four Paths Forward
- Private Equity Partnerships: For firms with strong growth potential and a niche offering, PE can provide a lucrative exit for retiring owners and the capital to scale. But it comes at a cost: reduced decision-making autonomy, culture shifts, and long-term vision may shift toward investor priorities—often a focus on profit.
- Mergers or Acquisitions: Joining forces with another independent firm can create synergy, expand services, and solve succession gaps. But integration is hard. Culture clashes, technology mismatches, and leadership realignment must be carefully managed.
- Independent Growth: Staying the course and growing organically allows a firm to retain full control. However, it requires investment in technology, leadership development, and client experience to stay competitive.
- Lifestyle Firm: Often not discussed are firms that enable more work-life balance and a comfortable life (even if salaries may be lower than market)—a valid alternative to the perhaps overly profit-focused traditional business model. People at these firms may work hard during busy season, but they work much less (sometimes even half-time) the rest of the year. Usually those who have gotten strong experience at a large firm and are willing to give up higher pay for more freedom adopt this style of firm.
Reclaiming the Driver’s Seat
The most successful firms aren’t waiting to react. They’re proactively evaluating:
- Strategic vision: What kind of firm do we want to be?
- Succession planning: Who is ready to lead?
- Talent pipeline: How are we building future capacity?
- Tech transformation: Are we leveraging tech to optimize how we work?
- Firm culture: How do we want to work and who do we want to attract to the firm?
There is no one-size-fits-all answer, but remaining competitive against a well-financed competitor requires a discipline most firms don’t have. What matters most is that firm owners make intentional choices and strategically invest their capital in areas that will have the most impact and differentiate their firm—either to employees or clients.
Whether you partner with PE, merge strategically, or double down on independence, now is the time to set your course—on your terms.
Donny C. Shimamoto, CPA, CITP, CGMA, is the founder and Inspiration Architect for the Center for Accounting Transformation, which enables transformation by guiding professionals through the adoption and change required in order to step into the future of the accounting profession. He is also the founder and managing director of IntrapriseTechKnowlogies LLC, a Hawaii-headquartered advisory-focused CPA firm dedicated to improving the world by helping small and mid-sized entities (SMEs) accelerate their business transformations through the application of Environmental Social & Governance (ESG) and Enterprise Risk Management (ERM) frameworks right-sized for smaller organizations.
