McConnell Jones, the largest African American-owned CPA firm, is expanding its geographic footprint as an integral part of its growth strategy.
The firm, based in Houston,
"We're getting two for the price of one here by having offices both in Atlanta and Columbus," McConnell Jones managing partner Wayne McConnell told Accounting Today about the Taylor acquisition. "It's a combination of what I see as a really good cultural fit for us, in addition to the geographic expansion."
McConnell Jones reported $23.4 million in revenue in 2024, with five offices, six partners and 148 employees. Acquiring Taylor adds two offices in Atlanta and Columbus, Georgia. McConnell Jones is a full-service firm, but it specializes in audit and assurance services, including commercial audits, benefit plan audits, federal government audits, public company assurance, state and local government audits, and nonprofit audits.
McConnell said the firm's federal government contracts have not been impacted so far despite the current presidential administration's actions.
"We're looking to take advantage of the relationships that we have with them to find other areas within their organization that don't necessarily have to be done by the Big Four," he said.
In terms of expanding existing service lines, adding Taylor boosts the firm's client advisory services.
"There's a reference to CAS 1, the more basic bookkeeping and accounting," McConnell explained. "But then there's CAS 2 that is more of a value proposition that you offer to clients, where you're not just taking care of what has happened historically, but you're bringing value to the table by assisting them in forecasting, budgeting areas that help them determine what's going on from an operational perspective so that they're making good business decisions. So the transaction we just did with Taylor really enhanced our ability to function more effectively in that CAS 2 space"
He also wants to expand the firm's data analytics capabilities but admitted it's been a challenging area for growth, both organically and through acquisition, due to his firm's size and a general lack of interest.
Open to PE
Like many other midsize firm owners, McConnell said he is open to a private equity investment.
"There's a lot of lather, I would say, in the private equity space," he added. "There's a significant amount of activity going on there, and I think those firms that are looking for capital to invest in talent and infrastructure are looking to do those deals if they meet the metrics and parameters that the private equity guys are looking for. I think it's an attractive alternative to certain firms."
McConnell noted that an investment is attractive, in particular, "for more seasoned partners to get a liquidity event done while setting the firm up for the transition from the founders to the next generation."
"There's also something to be said for remaining independent, and we feel it's important to look at all of our alternatives," he added. "We are a first-generation firm. We have not gone through a turnover from the founders to the next generation of partners, nor have we gone through a sale transaction upwardly. It's important to look at all alternatives and to see what fits best for your organization."
