Building a $500K Lifestyle Accounting Firm in Under 24 months w/Michael Meihaus, CPA
Podcast
Summary
In this episode of Growing Your Firm, host David Cristello speaks with Michael Meihaus, the owner of Meihaus CPA, who transitioned from a decade in public accounting to launching his own firm focused exclusively on retirement plan audits.
Michael shares his journey of self-discovery, including a pivotal conversation that prompted him to leave his job and pursue his passion.
The discussion touches on the importance of designing a firm that aligns with one’s lifestyle and the concept of “choosing easy mode” in the accounting profession.
Listeners will gain insights into creating a unique firm identity, as Michael’s website stands out from the conventional offerings typically found in the industry.
Tune in to explore the magic of retirement plan audits and the entrepreneurial spirit behind building a firm that reflects personal values and aspirations.
Guest Bio
Michael Meihaus is a distinguished CPA and the founder of Meihaus CPA, a firm that has carved a niche in the specialized field of retirement plan audits.
With over a decade of experience in public accounting, Michael’s journey is marked by a profound understanding of the complexities and nuances of the accounting profession, particularly in the realm of employee benefit plans.
Michael’s career began in the traditional landscape of public accounting, where he honed his skills in tax and audit services. His pivotal moment came when he stumbled upon the world of retirement plan audits, a sector often overlooked and undervalued within the industry.
This discovery ignited a passion for a service that, while essential, was frequently performed poorly and lacked the attention it deserved. Michael recognized a significant opportunity to transform the employee benefit plan audit experience, leading him to establish his own firm in 2022.
Under Michael’s leadership, Meihaus CPA has quickly gained recognition for its innovative approach to retirement plan audits. His firm is not just another accounting practice; it is a testament to his philosophy of focusing on quality, efficiency, and client satisfaction.
Michael believes that every retirement plan audit should be a seamless experience for clients, and he has dedicated his practice to ensuring that this is the case. His commitment to excellence is reflected in the firm’s tagline, “Reinventing the Employee Benefit Plan Audit Experience,” which encapsulates his vision of elevating industry standards.
Michael’s ethos is rooted in the belief that accounting should not only be about numbers but also about people. He emphasizes the importance of building strong relationships with clients and referral sources, understanding that trust and communication are key to successful partnerships.
His approach to business development is strategic and relationship-driven, focusing on connecting with investment advisors, third-party administrators, and 401(k) providers—individuals who are often the first to recognize when a client needs audit services.
In addition to his technical expertise, Michael is a strong advocate for the well-being of professionals in the accounting field. He has experienced the pressures and challenges of the industry firsthand, which has shaped his perspective on work-life balance and the importance of prioritizing personal well-being.
Michael’s journey has been characterized by a commitment to creating a sustainable and fulfilling work environment, both for himself and his team. He believes that success should not come at the expense of personal happiness and that a thriving business can coexist with a fulfilling personal life.
Michael’s achievements extend beyond his firm. He is an active member of the accounting community, sharing his insights and experiences through various platforms, including social media.
His willingness to mentor aspiring accountants and share knowledge reflects his dedication to fostering a supportive and collaborative industry. He understands that the future of accounting lies in innovation and adaptability, and he is committed to being a part of that evolution.
Detailed Synopsis
Specializing in a Niche Market: The Case of Retirement Plan Audits
In a recent podcast episode featuring Michael Meihaus, the owner of Meihaus CPA, the discussion centers on the significant advantages of specializing in a niche market, particularly in retirement plan audits. Here are some key insights from the conversation:
High Demand, Poor Execution
Michael emphasizes that retirement plan audits are a service required by every retirement plan in the United States with a certain number of employees. Despite this high demand, he notes that the execution of these audits is often lacking. Many firms do not prioritize these audits, leading to a widespread perception that they are tedious and poorly conducted. This gap in the market presents a substantial opportunity for firms willing to specialize and enhance the quality of service.
Identifying the Opportunity
Michael’s journey into this niche began with a chance encounter during his decade in public accounting. He discovered the complexities and challenges associated with benefit plan audits, which were often viewed as burdensome by larger firms.
He recognized that many firms were either unwilling or unable to dedicate their top talent to these audits, resulting in a lack of quality service. This realization prompted him to focus exclusively on retirement plan audits when he established his own firm.
Building a Unique Value Proposition
By concentrating on retirement plan audits, Michael was able to differentiate his firm from traditional CPA firms that offer a broad range of services.
His website’s tagline, “Reinventing the Employee Benefit Plan Audit Experience,” clearly communicates this focus. This specialization not only attracts clients seeking expertise in this area but also positions his firm as a leader in a market that is often overlooked.
Leveraging Relationships for Growth
Michael’s success in this niche can also be attributed to his strategic networking. He built relationships with key referral sources, such as investment advisors and third-party administrators, who are often the first to know when a client needs audit services.
By establishing trust and demonstrating the quality of his work, he generated a steady stream of referrals, significantly contributing to his firm’s growth.
Financial Success and Sustainability
In his first year, Michael’s firm generated approximately $200,000 in revenue, surpassing his previous salary at a larger firm.
By the second year, this revenue nearly doubled, reaching almost half a million dollars. This rapid growth underscores the profitability that can be achieved by focusing on a niche market where demand is high, and competition is lacking in quality.
The Journey of Starting a CPA Firm: Insights from Michael Meihaus
In the latest episode of the Growing Your Firm podcast, host David Cristello interviews Michael Meihaus, the owner of Meihaus CPA, who shares his journey of starting his own firm focused exclusively on retirement plan audits. Michael’s story is a compelling example of how personal experiences, professional frustrations, and market opportunities can converge to inspire entrepreneurship.
The Catalyst for Change
Michael’s journey began during the pandemic in 2021, after a decade in public accounting. He experienced a cycle of dissatisfaction with his job, oscillating between moments of contentment and periods of deep frustration.
A pivotal moment came when a colleague asked him why he wasn’t starting his own firm. This question prompted Michael to reflect on his situation, leading to a conversation with his wife, who had been observing his struggles. Her supportive response encouraged him to take the leap into entrepreneurship.
Discovering a Niche
Michael’s decision to focus on retirement plan audits stemmed from his unique experiences in his previous firm. He stumbled upon this niche by chance and recognized a significant gap in the market.
Many firms viewed benefit plan audits as a necessary but unprofitable service, often assigning less experienced staff to handle them. Michael saw an opportunity to provide a better experience for clients and to run a profitable practice by focusing on a service that was in high demand but poorly executed by many firms.
Building the Firm
In his first year, Michael successfully generated around $200,000 in revenue, exceeding his previous salary. He achieved this by leveraging relationships from his past, including clients he had managed and connections made through networking.
His former firm was supportive of his transition, allowing him to take clients with whom he had built relationships, facilitating a smoother start.
Michael emphasized the importance of building a network of referral sources, particularly investment advisors and third-party administrators, who could direct clients needing retirement plan audits to him. This strategic approach to business development proved effective, as he quickly established a solid client base.
Investing in Quality and Support
To ensure the quality of his services, Michael invested in quality control and consulting services from experienced professionals. He recognized that the scrutiny from regulatory bodies required a high level of expertise, and he was committed to delivering a quality product.
This investment not only helped him maintain high standards but also allowed him to focus on growing his business without getting bogged down in the minutiae of document management.
In his second year, Michael’s revenue nearly doubled to around $500,000, demonstrating the scalability of his niche practice. He hired a full-time administrative assistant and utilized part-time consultants to help manage the workload, allowing him to maintain a healthy work-life balance.
Reflecting on Growth and Purpose
As Michael enters his third year, he finds himself at a crossroads, contemplating the future of his firm. He has achieved financial stability and is questioning the need for further growth.
Instead of focusing solely on maximizing revenue, he is prioritizing his family’s well-being and personal happiness. Michael’s story highlights the importance of defining success on one’s own terms, rather than adhering to traditional metrics of growth.
He acknowledges that while there is potential for significant revenue growth, he values the freedom and flexibility that his current business model provides. Michael’s journey serves as a reminder that entrepreneurship is not just about financial success; it’s also about creating a fulfilling life that aligns with personal values and priorities.
Importance of Referral Sources
- Identifying Key Players : Michael emphasizes the significance of identifying the right referral sources in the accounting industry. For his practice, he found that investment advisors, third-party administrators, and wholesalers at 401(k) providers were essential contacts. These individuals are often the first to know when their clients need audit services, making them invaluable allies in business development.
- Building Trust : Establishing trust with these referral sources is paramount. Michael learned from his previous experiences that when you build strong relationships with these key players, they are more likely to refer clients to you. He noted that once you demonstrate good service and fair pricing, these sources will continue to send work your way, effectively filling your pipeline with potential clients.
- Leveraging Existing Networks : Michael’s success in generating business can be attributed to his proactive approach to networking. He reached out to individuals on platforms like LinkedIn and Twitter, seeking connections that could lead to referrals. This strategy not only expanded his network but also allowed him to tap into existing relationships that could yield significant business opportunities.
- Quality Over Quantity : In the episode, Michael mentions that while he had numerous meetings with potential referral sources, only a few turned into substantial business. This highlights the importance of focusing on quality relationships rather than merely increasing the number of contacts. The few key individuals he connected with ended up driving a significant portion of his revenue, demonstrating that strong, meaningful relationships can be more beneficial than a large network of superficial connections.
- Reciprocal Relationships : Michael’s approach to building relationships is not one-sided. He acknowledges the importance of reciprocity in these connections. By providing excellent service and maintaining open lines of communication, he ensures that his referral sources feel valued and are more inclined to refer clients back to him. This mutual benefit strengthens the relationship and fosters long-term collaboration.
- Adaptability and Growth: As Michael’s practice grows, he recognizes the need to adapt his strategies for maintaining these relationships. He is open to hiring additional consultants to manage the workload, which allows him to focus on nurturing these connections without becoming overwhelmed. This adaptability is crucial for sustaining growth in a specialized accounting practice.
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