What 2025 Is Revealing About M&A and PE in the Accounting Industry

For much of its history, the accounting profession has remained one of the most fragmented and independently operated sectors in professional services. Growth was largely organic, succession was internally managed, and ownership transitions followed well-established patterns. That foundation is now shifting.

In 2025, merger and acquisition activity, combined with increasing private equity participation, is accelerating structural change across the industry. While not every firm is directly involved in a transaction, the broader impact is being felt across valuation expectations, talent dynamics, technology investment, and long-term strategy.

Recent benchmarking data highlights the scale of this shift:

• 83 PE-related deals in 2025, compared to just 22 in 2024
• 118 transactions since 2020, totaling over $30 billion in value
• The U.S. accounting market now stands at approximately $145.5 billion in revenue

The data does not suggest a single direction for all firms. But it does point to several emerging signals that firm leaders should be aware of as they evaluate their own positioning.

Deal Activity Is No Longer Occasional, It Is Systemic

M&A activity within the accounting profession has moved beyond isolated transactions to a more consistent and structured pattern.

What was once opportunistic is now increasingly programmatic. Deal activity has accelerated to a pace that suggests consolidation is no longer a possibility, but an active force shaping the profession.

Several transactions in 2025 illustrate the scale and intent behind this shift:

• Baker Tilly + Moss Adams (~$7B deal) creating the 6th largest U.S. firm
• Citrin Cooperman (~$2B valuation) marking the first major PE-to-PE ownership transfer
• Continued multi-acquisition strategies by firms like Aprio and Cherry Bekaert

These are not isolated events. They signal the emergence of platform-based growth strategies where scale, geography, and service expansion are being built through structured acquisition pipelines.

For firm leaders, this raises an important question. If consolidation is becoming embedded in the market, what does that mean for firms choosing to remain fully independent?

Valuation Expectations Are Being Rewritten

One of the most significant shifts is how firms are being valued.

Traditional revenue-based pricing models are giving way to EBITDA-driven valuation frameworks, particularly for firms with strong advisory capabilities and scalable operations.

A simplified view of how valuation expectations are evolving:

Firm Size	Historical Pricing	Current Market Range
<$5M	~1.0–1.3x revenue	~3–5x EBITDA
$5–15M	~1.0–1.5x revenue	~5–7x EBITDA
$15–30M	Transition phase	~8–10x EBITDA
$30M+	EBITDA-based	~11–15x EBITDA

This shift is not just financial. It reflects a broader change in what the market values:

• Recurring revenue models
• Advisory service mix
• Technology-enabled efficiency
• Leadership scalability

Even firms not considering a transaction are feeling the impact. Internal partner buy-ins, succession payouts, and long-term firm valuation expectations are increasingly influenced by these external benchmarks.

The Mid-Market Is Facing a Strategic Decision Point

Firms in the $5M–$30M range are entering what can best be described as a transition zone.

At this stage, firms are large enough to attract investor interest but often still operate with partially institutionalized structures. This creates a strategic fork:

• Continue independent growth
• Align with a platform
• Explore external investment

What is changing is the reference point.

Historically, succession models were based on internal funding structures, often tied to revenue multiples over time. Today, those models are being compared against significantly higher external valuations, creating a gap that many firms are not structurally prepared to bridge.

The result is not just financial pressure, but a broader strategic decision around ownership, control, and long-term direction.

Technology and Talent Are Driving Investment Decisions

Two structural challenges consistently influence deal activity: technology adoption and talent availability.

• More than 40% of firms are not fully utilizing their current technology investments
• The profession has experienced a ~10% workforce decline since 2019
• These are not short-term issues. They are structural constraints on growth.

Private equity-backed platforms are actively targeting these gaps by:

• Investing in integrated technology stacks
• Standardizing processes across firms
• Offering competitive compensation structures to attract talent

This creates a widening gap between firms that can invest at scale and those that cannot.

For firm leaders, the implication is clear. Technology and talent strategy are no longer operational considerations. They are central to long-term competitiveness and valuation.

New Ownership Models Are Emerging

As capital enters the profession, ownership structures are evolving alongside it.

One of the more notable developments is the rise of alternative models that allow firms to access external investment while maintaining regulatory compliance. These structures typically separate attest functions from advisory operations, enabling capital participation without compromising independence.

This approach is being adopted across multiple firms and is quickly becoming a standard mechanism for enabling investment while preserving professional obligations.

While still evolving, these models reflect a broader trend toward more flexible and adaptable ownership frameworks.

The Competitive Landscape Is Expanding

Private equity participation is not limited to ownership changes. It is reshaping the competitive environment more broadly.

Well-capitalized platforms are:

• Expanding into advisory and consulting services
• Investing heavily in technology infrastructure
• Building multi-region and multi-service capabilities

At the same time, new types of participants are entering the market, including wealth management platforms and technology-driven service providers.

The result is a more complex competitive landscape where traditional differentiation based solely on compliance services is becoming less sustainable.

For independent firms, this reinforces the importance of strategic clarity, whether through specialization, client experience, or service expansion.

What This Means for Firm Leaders

The developments in M&A and private equity are not confined to firms actively pursuing transactions. They are influencing how the entire profession is structured, valued, and operated.

For firm owners and managing partners, the key question is not whether these changes are relevant, but how they apply to your firm’s current position and future direction.

Many of the patterns highlighted here vary significantly depending on firm size, service mix, and growth trajectory. Without a clear benchmark, it can be difficult to determine whether your firm is aligned with broader industry trends or operating outside of them.

Understanding these dynamics in greater depth can provide a valuable perspective when evaluating strategy, succession planning, and long-term positioning.