Meet Amanda Birch, the owner of Birch Accounting & Tax Services. She owns an accounting firm with 7 team members and over 1,800 clients.

In this episode, we talk about how you can acquire another firm! They share tips on how to find, evaluate, and successfully acquire other accounting firms to drive growth.

Show Notes:

Host:
Welcome back to another episode of The Accounting Firm podcast where we bring you valuable discussions and insights from accounting firm owners. In today’s episode, we have a special guest joining us to discuss how you can acquire another firm. Our guest today is Amanda Birch, the Founder of Birch Accounting & Tax Services. Amanda, welcome to the show!

 

Guest:
Thank you, Shahram. I’m excited to be here and share our journey with your listeners.

 

Host:
So, to start off, let’s talk about why you decided to acquire another accounting firm. Right? I think a lot of firms struggle with the decision.

 

Guest:
Well, we’ve been discussing it for a couple of years. Um, we’ve been growing organically. We have been doubling our revenue ever since Matthew joined our team three years ago. And our next step was, okay, let, how can we grow? Can we continue to grow organically as fast as we have? Or do we wanna kind of take the plunge and acquire another firm? And that option kind of fell in our lap. 

 

Host:
I think one of the biggest challenges a lot of firms face when they acquire another firm is the worry of what’s gonna happen with the existing client base. How did you manage that?

 

Guest:
It’s been an interesting journey even pre purchasing the practice. The other thing that we’re we’re doing is now that we’re in the fall, kids are back to school, the office is now established is sending out letters or postcards to the new client base and just saying, Hey, I know that Leonard had talked to you during tax season, but just let you know Yes, we’re here.

We also have an open door policy, I mean, we have that with our staff too, but with clients that I think is most important is they should be able to come in during business hours or know that if they’re not available during business hours, they can easily schedule a time after hours to talk with us. 

 

Host:
How did you know the kind of firm to acquire?

 

Guest: It’s, by us talking about our experience, we also get a lot of inquiries about that, how that went. Some people are looking to sell themselves or some people are looking to buy.  Also, speaking with business brokers, there is a huge demand for accounting firms. We’ve been told, Hey, you wanna sell?  We have buyers that are willing to spend, um, high seven figures on it. So trying to, to find those little, little pockets where we can communicate with them ourselves.

 

Host:
So, last question. What did you look at, what’d you look for in the business to really evaluate that this accounting firm was a good acquisition target?

 

Guest:
We were able to look at the records and they’ve had clients with them for like 20 years. So  my thought is that the clients are happy because they’re coming back. Also, they had a very low churn rate. By that I mean like less than 10% per year. So we weren’t concerned about that. Even in this last tax season, as they’re ready to exit, they’re still growing and bringing on new clients. So our original agreement was for their client base, their client list from 2021. We also got bonus clients from the 2022 tax season. So, we feel like we got a really good rate.

 

Host:
Thank you.