Size and Sizzle Make a Difference in CPA Firm M&A

Today’s buyers and sellers of accounting practices are looking for specialized service offerings, niche expertise, firm size, and reputational strength. Take stock of the forces shaping today’s deals and put the work in to position yourself more effectively.

Mergers and acquisitions (M&A) are among the most strategic levers for CPA firms to grow, secure succession, and sharpen market positioning. Buyers and sellers alike are seeking combinations that promise more than just spreadsheets and client lists. Today’s buyers and sellers are looking well beyond geography. Specialized service offerings, niche expertise, firm size, and reputational strength are often more important than zip code. Put simply, size and sizzle are rising to the top of the priority list as buyers and sellers place greater value on strategic fit, future potential, and firm identity.

As accounting firms navigate this evolving M&A landscape, it’s critical to understand what truly sparks interest on both sides of the negotiating table. Strategic deals succeed when both parties see long-term value, alignment, and opportunity. This is essential for crafting successful, future-ready partnerships.

Before entering M&A discussions, however, both buyers and sellers should take stock of the forces shaping today’s deals, consider how to position themselves more effectively, and improve the chances of a long-lasting merger.

Seizing on Size and Scalability

In accounting firm M&A, size is more than a headcount; it’s a signal of operational maturity and growth readiness. The number of team members, total revenues, service-line breakdown, and profitability by function all help buyers assess how prepared a firm is to scale, evolve, and integrate. These indicators don’t just influence valuation; they build deal appeal and inspire (or in some cases diminish) deal confidence.

Firms with fewer than 15 employees often lack a scalable infrastructure that many buyers prioritize, but small doesn’t mean unsellable. These firms can still attract serious interest, especially when they position themselves strategically and offer strong technical capabilities or proven leadership. The mountain may be steeper, but with the right focus and strengths it can still be climbed.

Firms in the 15- to 50-person range are attractive for several reasons. Firms of this size often have economies of scale already in place. A team with broader capacity can support a larger and more complex client base, which often brings greater technical complexity. Specialized roles, such as firm administrator, human resources, IT, business development, or client accounting services (CAS) are more likely to exist, allowing partners to prioritize strategic leadership and high-value decision-making. Additionally, workflows and processes tend to be better documented, creating a smoother path to integration and scalability.

These organizations typically offer a deeper bench of technical knowledge across a wider range of subject matters, along with a spectrum of staff at every career stage. This combination signals both operational expertise, succession readiness, and organizational maturity. The professional development process tends to be more structured, with clear pathways for advancement. These are qualities that appeal to acquirers seeking long-term team stability and leadership cultivation.

Firms in this range also tend to foster a more technology-forward culture, with the systems and internal expertise to support it. They are more likely to have evaluated, implemented, and integrated cloud-based tools, workflow automation, and data analytics platforms, positioning them to operate efficiently and respond quickly to client needs.

Many firms of this size are already exploring offshoring and outsourcing, strategies that reflect both operational foresight and a commitment to future-ready practices. These capabilities can be extremely attractive to buyers who may be concerned about integration delays or the steep learning curves often associated with smaller firms that have not embraced these approaches.

The question of scalability may be especially pertinent with the growing presence of private equity (PE) and other capital partners in the CPA space. PE and other investors look for firms with a scalable infrastructure, recurring and predictable revenue streams, healthy profitability, and the willingness and ability to align with a larger vision.

Finding the Sizzle

While size and scalability are often straightforward and measurable, sizzle is less tangible when it comes to firm attractiveness.

Reputation is one of the biggest indicators of sizzle. It reflects not only how trusted a firm is, but how embedded it is in the business community. Firms with strong referral networks and deep ties to local or niche business markets tend to command more interest in M&A because they offer confidence in continuity, brand lift, and client loyalty.

Sizzle may also come from the types of clients a firm serves and the access those relationships offer to broader, high potential opportunities. A firm that shows disciplined selectiveness in taking on new clients, with a thoughtful screening process and a willingness to disengage with those that don’t fit, is particularly appealing to buyers looking for intentional growth.

Specialization plays a major role, too. Firms that have developed expertise in niches such as CAS, high-net worth, family office, state and local tax, international tax, forensic accounting, and transaction support and advisory services often bring both margin and market panache to the table, making them more attractive.

Strong internal culture is another form of sizzle. Demonstrable and repeatable profitability offers an attractive package for M&A, but it becomes far more powerful when paired with signs of true collaboration and cohesion. Firms that exhibit professional pride, authentic teamwork, and a strong commitment to technology project a culture that buyers seek. These practices are environments where people support one another, take ownership, and care deeply about outcomes. Low staff turnover, strong partner engagement, and open communication all reinforce a culture of trust, loyalty, and long-term value.

Firms that meet the sizzle standards are those with strong reputations, standout niches, and vibrant cultures, and are often looking to align upward. For them, sizzle isn’t just something to showcase but is a quality they actively seek in others. If a potential acquirer demonstrates a compelling mix of energy, brand strength, and cultural compatibility, it can tip the scales.

Building a Lasting Relationship

M&A success isn’t just measured at closing but over time. The goal isn’t just to complete a deal but to build a relationship that delivers long-term strength, growth, and mutual satisfaction for all involved. Size, scalability, and sizzle aren’t just buzzwords – they are strong signals of future success and alignment. When present on both sides of a potential deal, these qualities raise the ceiling on what a deal can deliver.

Firms should approach M&A with selectivity and vision. Defining clear criteria beyond financials or urgency increases the chances of achieving a meaningful and lasting match, and all parties involved can be more confident of their long-term happiness and gratification.

The best deals happen when firms look beyond rigid financial targets or looming retirement dates and instead prioritize strategic alignment, cultural fit, and long-term rewards. So, find your sizzle and let it pop!

Ira Rosenbloom, CPA (inactive), is the founder and chief operating executive of Optimum Strategies LLC, an M&A adviser to CPA firms, and a member of the Pennsylvania CPA Journal Editorial Board. He can be reached at ira@optimumstrategies.com.