How Accounting Firm Owners Can Maximize Their Firm’s Value

By Daniel Talbott

Most accounting firm owners wait until the last minute to think about what it will mean to sell their firm; even after a lifetime spent building it.

Here's the truth: firms that command the highest multiples don't get there by accident!

If you’re an accounting firm owner thinking about exiting in the next 1 to 5 years, NOW is the time to act. 

Small shifts in how you run your firm today can have a major impact on what a buyer is willing to pay tomorrow. 

This guide will walk you through the proven ways to increase the value of your firm and get rewarded for the business you’ve built.

Why Valuation Isn’t Just About Revenue

It’s easy to assume your firm’s value is based on revenue alone—but serious buyers are looking at something else: profitability, consistency, and transfera\bility.

Your firm’s value is typically based on either:

• SDE (Seller’s Discretionary Earnings) if it's a small owner-operated firm, or
  

• EBITDA if it’s a larger, team-based operation
  

Buyers use a multiple of SDE or EBITDA to arrive at a purchase price. That multiple usually ranges from 1.2x to 2.8x Gross Sales—but that is driven by 3x SDE or 4 to 5x EBITDA, and sometimes higher for firms with recurring revenue, great systems, and a strong team in place.

So how do you increase that multiple?

5 Ways to Maximize the Value of Your Accounting Firm

1. 📊 Improve Financial Visibility

Clean books sell. If your firm doesn’t have solid financial statements, buyers get nervous—or they start discounting your price.

This is actually crazy to be writing to ACCOUNTING FIRM OWNERS—CPAs even—but after reviewing hundreds of accounting firms’ books, it’s unfortunately necessary!

• Please, move to accrual-based accounting if you're still on cash
  

• Have at least 2–3 years of clean, normalized financials
  

• Use a cloud-based accounting system and consider working with a fractional CFO or controller to clean up reporting. Track your budget, forecast, and Cost of Goods Sold!
  

A buyer should be able to look at your books and immediately understand how money flows through your business. How healthy the operation is through proper pricing, managed fulfillment costs, and responsible overhead.

2. 🔁 Systematize and Standardize Operations

Document everything! From how clients are onboarded to how tax returns are reviewed. If you can hand someone THE playbook—they can run your firm. That’s valuable!

• Create Standard Operating Procedures (SOPs)
  

• Use workflow management tools like Karbon, Jetpack Workflow, or Canopy
  

• Systematize email templates, client requests, and reminders
  

The more repeatable your operations are, the less dependent they are on you.

3. 👩‍💼 Build a Team That Can Run Without You

No buyer wants to buy a job. They want to buy a business! The more critical you are to daily operations, the more risk they perceive.

• Delegate Sales, Fulfillment, and Hiring. These three things must happen without you.
  

• Promote or hire a second-in-command who can keep things moving post-sale
  

• Offer stay bonuses or employment agreements to keep key team members on board
  

Your goal? Make yourself replaceable.

4. 🎯 Niche Down and Show Specialization

Firms that serve a specific industry, or offer a specialized service, often sell for higher multiples. 

Why?

• Niches create pricing power
  

• They reduce churn
  

• They’re easier to market and grow
  

If 70% of your client base is made up of real estate investors, marketing agencies, or med spas, say so. Buyers will pay for focus and consistency.

5. 💰 Raise Prices Strategically

Many firm owners undercharge—especially those who’ve had long-standing client relationships. But here’s the thing: higher prices = higher profit margins = higher valuation.

• Conduct a pricing audit. See the blog post on the {{Client Grading Exercise}}
  

• Reposition compliance services with bundled advisory offerings
  

• Introduce higher-margin services like cash flow planning or virtual CFO support
  

Even a 15% price increase can move your valuation up significantly.

Timing Matters: Start 2–3 Years Before You Plan to Sell

Too many owners start planning after they’re already burned out. Don’t be that seller.

Start 2–3 years early so you can:

• Increase margins and build recurring revenue
  

• Reduce owner dependence
  

• Prepare your tax strategy for the sale

• Identify the right successor

Remember, you don’t get paid for potential—you get paid for proven performance!

Real-World Example

Let’s say John owns a $1.2M accounting firm. His SDE is $400K, but he handles most of the client relationships himself. He hasn’t raised prices in five years, and his processes live in his head.

With no changes, he might get a 2.5x multiple, or $1m for his firm.

But if John spends 18 months raising prices, hiring a manager, and building SOPs, he could increase SDE to $500K and push his multiple to 3x.

That’s $1.5 million—a $500K increase in value, just by running the firm better. 

Don’t Leave Money on the Table

If you're even thinking about selling, it’s time to get serious about how your firm runs. Because at the end of the day, the difference between an average exit and a life-changing one comes down to preparation.

Slowing down before you sell is like putting all of your retirement savings in a losing stock!

✅ Get a Broker’s Opinion of Value

Want to know what your firm is worth today—and what you could do to raise that number?

Schedule a confidential valuation call with Daniel Talbott.
Let’s talk about where you are now and how to build a roadmap to your ideal exit.