Key Takeaways
- Independent firms can compete without matching PE-backed firms’ size or budgets. Specialization, client experience, and speed of execution create meaningful advantages.
- Technology efficiency matters more than the number of tools. Intuit’s 2026 survey found firms use 10 applications on average, with accounting professionals losing approximately five hours per week moving information between systems.
- Independence is an advantage when you use it. Owners can make decisions faster, develop deeper client relationships, and adopt technology without navigating a large corporate organization.
You Don’t Need Private Equity to Build a Better Accounting Firm
I spend a lot of time talking with accounting firm owners about the future of their businesses. Lately, private equity seems to be part of nearly every conversation. Another acquisition gets announced, another regional firm changes hands, and independent owners wonder what this consolidation means for their future.
It’s a reasonable concern. Private equity-backed accounting organizations have substantial resources to acquire practices, recruit talent, invest in technology, and expand their services.
But I don’t believe independent firms need to follow the same playbook to succeed.
At CountingWorks PRO, we’ve made a deliberate decision to remain independently owned. We haven’t taken venture capital funding, and we have no plans to raise it. We’re investing in AI, automation, and client relationship technology because we believe independent accounting firms have a tremendous opportunity to build stronger businesses without giving up ownership.
That perspective shapes how I look at consolidation.
In the first article of this series, we examined why investors see so much value in accounting firms. Now I want to address the question that matters to owners who intend to remain independent.
How do you compete when the firm across town suddenly has private equity money behind it?
My answer is straightforward: stop trying to compete on size. Become exceptionally good at being independent.
Here are four places I’d focus.
1. Specialize, and Make Sure Clients Know It
Private equity-backed accounting platforms can offer an impressive range of services. They may have offices across several states, specialists in multiple disciplines, and marketing budgets most independent firms can’t justify.
Trying to match that breadth is usually the wrong strategy.
I’d rather see an independent firm become the obvious choice for a particular type of client.
Consider an accounting practice with extensive experience serving construction businesses. Its professionals understand job costing, equipment financing, cash-flow fluctuations, contractor payroll, and the tax implications of large capital purchases.
That knowledge has value beyond preparing an accurate tax return.
Now look at how many accounting firms describe themselves online. They offer tax preparation, bookkeeping, payroll, and business consulting. Their websites promise exceptional service and personalized attention.
The firm with genuine construction expertise may be dramatically better suited to a contractor, yet nothing on its website explains why.
That’s a missed opportunity.
I’d encourage owners to identify the clients they serve particularly well and build their positioning around those relationships. That could mean an industry, a type of business owner, or a recurring financial situation.
A strong niche doesn’t require turning away everyone else. It requires making your expertise recognizable to the right prospects.
And in 2026, recognizable also means discoverable.
Prospective clients increasingly use Google, professional directories, online reviews, and AI assistants to research accounting firms. A referral may get your name into the conversation, but your digital presence helps prospects determine whether you’re the right fit.
If your website clearly explains whom you serve, the problems you solve, and the experience your team brings, prospects have more evidence to evaluate. Search engines and AI systems also have more specific information about when your firm may be relevant.
We’ve explored the execution in Why Your Accounting Firm Needs a Who We Help Page.
My advice is to spend less energy trying to look like a national accounting firm and more energy becoming the firm that a particular type of client immediately recognizes as relevant.
That’s a competition a smaller practice can win.
2. Turn the Client Relationship Into a System
Nearly every independent accounting firm I’ve encountered believes personal service is one of its strengths.
I understand why. Owners build relationships over many years. They know their clients, remember important details, and often become trusted advisors to entire families.
But there’s a difference between having good relationships and delivering a consistently good client experience.
Consider two accounting firms onboarding a new business client.
At the first firm, the client signs an engagement letter, receives an email requesting documents, gets another message with portal instructions, and eventually hears from someone else who needs additional information. The client isn’t sure whether everything has been received or what happens next.
At the second firm, the client accepts a proposal and enters a coordinated onboarding process. The engagement agreement, intake questions, secure document requests, and next steps are organized. The client understands what’s needed, who’s responsible, and how the relationship will work.
Both firms might have excellent accountants. Both might genuinely care about their clients.
The second firm has turned that commitment into an experience the client can feel.
And that matters beyond onboarding.
A client should know when something requires attention, where to find information, and whom to contact. Their accountant should recognize opportunities for planning rather than communicate only when another tax deadline approaches.
This is where technology should strengthen the personal relationship rather than replace it.
Client portals, automated follow-ups, organized communications, and relationship management tools allow smaller firms to provide consistent attention without asking the owner to remember every detail.
That distinction becomes particularly important as firms grow.
The International Federation of Accountants’ analysis of private equity consolidation identifies potential benefits from larger, better-resourced organizations, while also recognizing the risk that consolidation could create more corporate, less client-centric environments.
I wouldn’t build a competitive strategy around assuming a PE-backed firm will provide poor service. Many won’t.
But every accounting firm, regardless of ownership, has to deliver on its promises.
For independent owners, the opportunity is to make personal attention something clients experience consistently, rather than something they simply read about on a website.
We explored the prospect-facing side of that challenge im Your Accounting Firm Needs a How We Work Page.
The deeper operational challenge is ensuring the experience described there actually happens.
3. Cut the Administrative Work Clients Never Wanted to Pay For
Here’s where I believe AI changes the competitive equation.
For decades, accounting firms have faced a familiar limitation. Growth creates more administrative work, and managing that work typically requires more employees.
Documents need collecting. Missing information requires follow-up. Clients ask for updates. Engagement letters, proposals, approvals, and routine communications consume hours that could otherwise be spent delivering professional services.
Smaller firms feel this pressure intensely because they don’t have large administrative departments to absorb it.
The 2026 Intuit Accountant Technology Survey, which surveyed 725 U.S. accounting and bookkeeping professionals, shows how much inefficiency remains.
The average firm uses 10 applications to manage operations and clients. One in three respondents reported that their firm uses 11 or more.
Accounting professionals reported losing approximately five hours per week moving, re-entering, or reconciling information across systems.
Think about that in a 10-person practice. Even recovering a portion of that lost time could create meaningful capacity without hiring another employee.
And the answer isn’t automatically another software subscription.
Too many firms have accumulated disconnected tools that each solve one problem while creating additional work between systems.
I’d focus on eliminating the handoffs.
Can a client’s information move from an accepted proposal into onboarding without being entered again? Can missing documents trigger a clear follow-up? Can routine questions be answered or drafted using approved firm information? Can the team see which engagements require attention without searching multiple applications?
AI-assisted workflows can help connect these activities, provided firms establish appropriate safeguards for confidentiality, accuracy, and professional review.
The opportunity isn’t simply to use AI. It’s to make AI part of how the work gets done.
The AICPA’s 2026 CPA Firm Top Issues Survey reinforces the urgency. Managing change related to technology and AI ranked as the number-one anticipated issue over the next five years across every firm-size category.
For sole practitioners and firms with up to 10 professionals, tax-law complexity still ranked first among immediate concerns. But owners of every firm size recognize that technology is changing the profession’s future.
I see that shift as an opportunity for independent firms.
A five-person practice doesn’t need to assemble the technology department of a national organization. It needs practical systems that reduce routine work, protect client information, and give professionals more time to serve clients.
At CountingWorks PRO, that’s a major part of what we’re building with MAX: coordinated client relationships, AI-enabled workflows, and fewer administrative steps between the firm and the work it needs to accomplish.
The broader principle applies regardless of which platform a firm chooses.
The competitive advantage comes from the work you eliminate, not the software you accumulate.
4. Move Faster Than the Firms Trying to Consolidate
One advantage independent owners sometimes overlook is their ability to make decisions.
If you see an opportunity to introduce a new advisory service, improve onboarding, specialize in an emerging industry, or change an inefficient process, you can act.
You don’t need approval from an investment committee or a corporate leadership team managing dozens of offices.
That doesn’t mean larger organizations are incapable of moving quickly. Some are exceptionally well managed and have resources to implement improvements at scale.
But integrating multiple acquired accounting firms is complicated. Different systems, cultures, client expectations, and operating processes have to be brought together.
Independent firms can use that period of industry transition to improve their own businesses.
Let’s say you notice that your business-owner clients increasingly need help understanding cash flow and making decisions before year-end.
You could spend six months developing a comprehensive advisory program.
Or you could identify a small group of clients, offer a focused planning engagement, learn what they value, and refine the service before expanding it.
The same approach works with technology.
Choose one frustrating process, improve it, measure the results, and move to the next.
An independent owner can make progress through a series of practical decisions rather than a massive transformation project.
Of course, this advantage disappears if you’re so buried in daily operations that you never have time to make those decisions.
That’s why the previous three priorities matter. Specialization helps attract the right clients. Better systems strengthen the relationship. Automation creates capacity.
Together, they give the owner room to lead.
Four Questions I’d Ask Every Independent Firm Owner
If I were evaluating an independent accounting practice today, I’d start with four questions:
- Are we the obvious choice for the clients we most want to serve? Can prospects immediately recognize our expertise and understand why we’re a good fit?
- Do our clients consistently experience the personal service we promise? Is onboarding, communication, and proactive follow-up organized, or dependent on individual employees remembering what to do?
- Are we eliminating administrative work or simply adding more technology? Which repeated tasks and disconnected handoffs can we remove?
- Are we moving quickly enough? Have we meaningfully improved our client experience, service offerings, or operating efficiency in the past 90 days?
You don’t need a corporate strategic planning department to answer those questions.
You need the willingness to examine how your firm operates and make changes where they matter.
Independence Is Worth Investing In
Private equity will continue reshaping the accounting profession. Some acquired firms will emerge as stronger, more sophisticated competitors. Others will struggle with the realities of integration.
I don’t think independent owners should spend much time worrying about which outcome occurs.
I’d rather see them invest that energy in building better firms.
For me, remaining independent is about preserving the ability to make long-term decisions around what we believe clients need. We’re investing in technology and AI because we believe the accounting profession is moving toward more automated operations and more valuable human relationships.
And we believe independent firms should have access to those capabilities without having to become part of a much larger organization.
That’s the opportunity I see ahead.
A smaller accounting practice can be specialized, technologically sophisticated, operationally efficient, and deeply connected to its clients. Those qualities can reinforce one another.
Private equity may have the capital to build bigger accounting organizations. Independent owners have the freedom to build businesses that reflect their own priorities and the needs of the clients they serve.
The independent firms that thrive won’t be the ones trying hardest to look like their larger competitors. They’ll be the ones that become exceptionally good at being independent.
Next in this series: What Makes an Accounting Firm More Valuable in the Age of AI?
Frequently Asked Questions
Can independent accounting firms compete with private equity-backed firms?
Yes. Independent accounting firms can compete through specialized expertise, personal client relationships, efficient operations, and faster decision-making. Technology and AI can help smaller firms deliver sophisticated services without matching the size or overhead of larger organizations.
What advantages do independent accounting firms have over PE-backed firms?
Independent firms control their own business decisions, can focus on specific client markets, and can adapt their services and processes quickly. They can also offer continuity and direct relationships with experienced professionals. These advantages are most valuable when supported by consistent operations.
How can AI help small accounting firms compete?
AI can reduce administrative work associated with document requests, client onboarding, routine communications, research support, and workflow coordination. Firms should use appropriate security controls and human oversight, particularly when handling sensitive client information or providing professional advice.
How can an accounting firm differentiate itself from larger competitors?
A firm can distinguish itself by clearly identifying the clients it serves best, demonstrating relevant experience, providing a consistent client experience, and making its expertise visible through its website, educational content, and reputation.
Do independent accounting firms need private equity investment to modernize?
No. Independent firms can adopt AI, automation, integrated workflows, and improved client relationship systems without selling ownership. The right investments depend on the firm’s goals, resources, and operational needs.
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