Accounting Firms in 2025: Growth, Innovation, and the Leadership Challenge

The rules of success in accounting are being rewritten.  

While organic growth challenges and private equity consolidation create competitive pressures, artificial intelligence and evolving client expectations open doors to new service models and efficiency gains. This dynamic environment presents firm leaders with both significant hurdles and strategic opportunities—those who thoughtfully recalibrate their approaches to growth, talent development, and long-term sustainability will find themselves positioned to thrive in this transformed landscape. 

In a recent discussion, Winding River Consulting’s Gary Shamis and David Toth explored the biggest concerns and opportunities Managing Partners are facing today, offering insights into growth strategies, the private equity landscape, and the role of AI in the profession. Here’s what firms need to focus on to stay competitive and future-proof their success. 

Organic Growth: A New Era of Intentional Strategy 

One of the biggest concerns we’re hearing from firms is slowing organic growth rates. While many firms have experienced several consecutive years of double-digit revenue growth, many are now experiencing a change in where and how those opportunities are being developed. Growth today requires more intentional and strategic efforts than ever before accelerated by the political and economic influences. 

Firms need to embrace a multi-faceted growth strategy that includes: 

• M&A as a growth lever: Many mid-sized firms have successfully scaled through mergers and acquisitions, and it's a strategy that remains viable. Whether it’s merging with other firms, hiring independent practitioners, or expanding into new markets through acquisitions, there are limitless opportunities for ambitious firms.  

• Digital marketing and lead generation: Digital-first firms are demonstrating how niching down and leveraging digital channels can drive substantial growth. From niche digital growth campaigns to highly-targeted outbound strategies, the technologies available today make it easier than ever for firms to execute sophisticated campaigns at scale.  

• Traditional relationship-based growth: While digital strategies are on the rise, firms must continue investing in business development and client relationships as a foundation for long-term success. Opportunity lies in marrying the offline with the online to create comprehensive experiences that impress prospective clients.  

The Middle Market Opportunity – The Future of the $50m Firm 

We see an emerging opportunity in the middle market. With consolidation moving many firms upstream, many middle-market businesses lack a trusted advisor as large firms increasingly prioritize enterprise-level clients. Mid-sized firms can capitalize on this gap by providing high-touch advisory services to businesses generating between $10 million and $300 million in revenue. 

For a mid-sized CPA firm with $50M or so in revenues, this client profile is a natural fit. But many leaders are beginning to wonder whether $50M firms are in a difficult middle ground—too big to stay small but too small to compete with billion-dollar firms and PE-backed consolidators. 

We firmly believe that $50M firms can still thrive—but only if they focus on: 

• Defining a clear strategic position in the market (e.g., trusted advisory services, vertical specialization). 

• Developing strong leadership and succession planning to ensure sustainability. 

• Revisiting deferred compensation structures to maintain partner alignment and avoid internal pressure to sell. 

Trusted Advisor Model: Is Subscription Pricing the Future? 

Many firms are grappling with an innovative concept in the industry: subscription-based pricing for CPA firms. This recurring revenue style model has gained significant traction in recent years as many firms launch ‘stickier’ advisory service lines like CAS, HR, and Technology Services, but it’s a model that could be expanded further.  

Firms could monetize their role as trusted advisors through a retainer model, ensuring guaranteed revenue while managing capacity challenges. Consider the concierge medicine model: people will pay a premium for on-demand access to a high-quality experience. However, implementing this type of change is no easy task, and many firms are afraid to be the first to try it. 

Private Equity: The Unfolding Impact 

Private equity (PE) remains one of the most polarizing and complex issues in the profession. The recent Citron deal at 15x EBITDA has raised questions about whether these valuations are sustainable. 

There are several major concerns to be aware of with PE-backed firms: 

• Client service transformation: Many PE-backed firms are shifting from trusted advisory relationships to transactional models focused on profitability. 

• Retention challenges: Younger partners, who didn’t get significant payouts, may become dissatisfied and leave, creating recruitment opportunities for independent firms. 

• Alignment issues: Senior partners benefiting from buyouts may push for firm sales, leading to internal misalignment if younger partners aren’t on board. 

The key takeaway? Independent firms need to focus on profitability and succession planning to remain competitive against PE-backed firms and avoid internal pressure to sell. 

Artificial Intelligence: Preparing for Adoption 

AI is reshaping accounting right now––and if your firm doesn’t have a comprehensive strategy, its falling behind. Forward-thinking firms should be thinking not just about AI tools, but about firm-wide AI adoption strategies. 

How Firms Are Using AI Today: 

1. AI-powered note-taking & task automation – Tools like Fireflies AI, Otter AI, and Copilot are improving efficiency by automating meeting notes, client follow-ups, and updating CRM systems. 

1. Tax & research automation – Platforms like BlueJay AI are helping firms automate tax research and draft client communications. 

1. AI-driven content creation – Firms are training AI agents to generate thought leadership content at scale, supercharging the efficiency of their marketing team. Tools like ChatGPT, Perplexity, Claude, and others have emerged as popular resources here. 

1. Time tracking and billing insights – Tools like Laurel AI are being explored for improving time-tracking accuracy and billing efficiencies. 

Key AI Adoption Question: Are Firms Ready? 

The biggest challenge firms face isn’t just choosing the right AI tools—it’s preparing their teams for AI adoption. Firms need to: 

• Develop AI policies and governance to ensure responsible usage. 

• Identify quick-win AI implementations, such as note-taking tools, before tackling more complex automation projects. 

• Create a culture that embraces AI instead of fearing it. 

The Role of CPA Firm Alliances in an Evolving Landscape 

The rise of firm consolidations and PE deals is putting new pressure on CPA firm alliances. Larger alliances, like the BDO Alliance, are evolving to provide more value to firms. However, smaller alliances may struggle to remain competitive in a rapidly changing environment. 

As firms navigate growth strategies, independence decisions, and industry shifts, alliances that offer business development support, knowledge sharing, and leadership training will become increasingly valuable. 

Leadership Development: The Key to Future Success 

With all these industry shifts, one factor remains unchanged—the need for strong leadership. The ability to develop, mentor, and retain the next generation of firm leaders is more critical than ever. 

At Winding River Consulting, we work with firms to train the next generation of partners and managing partners, helping them navigate growth, business development, and client leadership with intentional strategy and proven frameworks. 

If you’re serious about emboldening the leadership competencies of your firm, explore our leadership development programs, including our Managing Partner Bootcamp and Basic Training Bootcamp. 

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