As the old saying goes: “Do what you love and the money will follow.” Well, Joshua Lance, founder and managing director of Chicago-based Lance CPA Group, has taken that to a new level. Lance’s 19-person firm provides accounting and consulting services primarily to craft breweries and digital agencies. While those two industries appear to have little in common, they hold special affection for Lance and his team.
After stints in public accounting and family office management, Lance realized he didn’t want to be a road warrior or slave to billable hours any longer. He asked himself one day, “What if I could build a CPA practice that focused only on industries I’m passionate about and run it exactly the way I’d want to run a firm?”
So that’s what he did about seven years ago, and he hasn’t looked back since.
Many large firms develop industry specializations, but smaller firms tend to serve a wide range of clients who come to them via referral, primarily from their immediate geographic area. Lance CPA Group is among the new breed of small, nimble firms that serve one or two niche industries from all over the country, if not the world. The key to making the virtual model work is having great talent across the country, a strong culture, flexible work schedules and best-in-breed cloud-based technology.
All 19 of Lance’s employees work remotely and live across many time zones — just as the firm’s clients do. While some consider a remote workforce difficult to manage, Lance believes it gives his firm a competitive advantage. “It’s so important to have the right kind of people onboard. Being virtual allowed us to cast a much wider net to attract (and retain) talent we never could have brought in if we only recruited locally.”
Like my firm, Lance’s firm allows employees to have great flexibility when it comes to how and when they work. “We have specific deadlines about when a thing must get done and out to clients, but in terms of the time of day or day of week, we let employees build a schedule that works best for their lifestyle,” explained Lance. “Many of our employees have kids in school, so they’ll work primarily during school hours and finish up at night or on weekends. This kind of flexibility allowed us to attract great people because we’re offering something most other accounting firms don’t offer — or don’t offer well.” Unlike many firms that can make remote workers feel like second-class citizens, Lance makes sure every team member stays in the loop without having their work-life boundaries encroached.
“Word gets around [about our culture] and great people come to us,” said Lance. “We don’t have to fish for talent. It also allows us to build roles and responsibilities around the right kinds of skill sets that we need for our company as a result.”
Communication in a virtual firm
As you might expect, video calls are the primary method of communication for team members and clients who aren’t in the Chicagoland area. Lance said he’ll still fly across the country to meet with clients in person to keep the relationship strong. But his firm tries to do the bulk of its day-to-day work virtually and get client information virtually. He feels it’s the best use of everyone’s time and the best way to be collaborative. It’s not just a “do some work and wait and see type of thing,” quipped Lance.
The virtual model also makes it easier to adapt to working with clients far overseas, especially during COVID times, according to Lance. “We have some clients in Australia,” he said. “It’s 5:00 our time and it’s the morning the next day for them, and we’re still going to interact with each other in real time and get things done. It’s very exciting.”
Emphasis on industry niches
When deciding which industries to focus on during his firm’s early days, Lance said the craft brewery industry was a natural fit. Like me, Lance is a longtime home brewer and craft beer enthusiast with many friends who share his passion. One friend, a very serious home brewer at the time, asked for Lance’s help starting a brewery. That assignment gave Lance specialized expertise and deep industry knowledge that he was able to leverage into helping many other craft brewers. He added digital agencies to his client roster after getting to know many of them intimately when they approached him after he launched Lance CPA Group. Lance has been drawn to craft brewers and digital agencies because they're filled with creative people who are passionate about what they do. He believes that enthusiasm rubs off on him and his team to make them more innovative and productive.
I was proud of being a well-rounded generalist when I started my career in public accounting. But when I co-founded Tri-Merit about 13 years ago, I knew we had to focus on a few specific areas of the tax code (i.e., R&D tax credits) to win the business. I didn't realize at the time how much more fun that was. Concentrating on just one or two industries allows you to dig deeper into that industry and become the go-to expert. I only wish we had realized that sooner.
By showing clients you understand the trends within their industry as well as their unique challenges and opportunities, you become significantly more referable. “Lots of breweries come to us and say, ‘Hey, I know you work with breweries, or I’ve heard you speak at craft-brewing conferences or followed your blog or social media posts. I’d love to have you come and talk and see if we can work together,'” said Lance. So, you can see how the multiplier effect starts to build.
Three-tier option pricing
Like me, Lance hated time tracking when he was in public accounting. Like more and more progressive firms, Lance CPA Group doesn’t bill by the hour or by the project. Instead, it charges by the value created, not by the number of hours put in.
Lance believes three-tier option pricing isn’t just better for the bottom line — it creates a better collaborative relationship with clients. With three-tier option pricing, clients aren’t afraid to call or email with questions and feel like they’re going to get billed by the hour each time they do so. Lance said a number of clients came to his firm because their prior accountants discouraged them from asking questions. “Value pricing has helped us define the scope of our client engagements, the problems we’re solving for clients and the value we’re delivering to them,” noted Lance, adding that it’s better for both the client and the CPA.
Growth strategies
While niche firms are growing strongly, they aren’t consumed by dreams of a hockey stick growth rate. Lance told me his firm doesn’t have specific dollar or percentage growth numbers in mind. Instead, they have “three-year iterations” of what their firm’s strategic plan is and to keep evaluating when they sense they’re growing too fast or not fast enough. “For the next few years our goal is to continue growing this firm in a way that's healthy and sustainable,” explained Lance. “We want to grow in a way that allows employees to be proud of the work they’re doing and to enjoy going along for the ride.” To do that, Lance said everyone on the team must know when you have to step on the accelerator and when you have to take your foot off. “Right now, we’re stepping off the accelerator, because we met our growth goals and targets for the year. Growing more would be painful for everyone involved. But next year we’ll put that foot back on the gas and go after some more targets that we want to hit.”
Core values
When a team is spread out across the country, it’s easy for everyone to feel like they’re on an island. Lance‘s firm brings his entire team together in Chicago several times a year for company retreats. They also have regular virtual happy hours and weekly team meetings in which the agenda is just to check in with each other to see how they’re doing. Lance believes having a good firm culture is the glue that makes employees and clients stick around for a long time. As with his wide-ranging beer preferences, Lance believes it’s a lot of fun (but also very important) to have a firm with diverse views and voices. It makes everyone stronger and well-rounded, and things never get stale or lose their zest.
For more about combining your life passions with your work, see my recent article,
