Emotional Investment in an Accounting Practice

In our Becoming a Rainmaker seminar, we remind our participants that prospective clients buy for an emotional reason.  They need an accounting service performed, of course.  But there are many ways to satisfy that need and many accountants willing to do it.  The most successful accountants take the time and have a process to uncover the client’s emotional motivation underlying the need and then cater their service to encompass this motivation.

We can apply this same principle to buying and selling accounting practices.  Buyers buy for emotional reasons and for a successful acquisition it is important for them and those they are in dialog with to understand their emotional motivation.

We all function alike.  Human behavior involves three parts – motivation, intention and action.  

• Motivation is the driving force.  It is the need, want, or desire that inspires movement.
• Intention is what we aim for.  It is what we hope to accomplish.  
• Action is what we do.

It is also the case that sellers sell for an emotional reason.  The decision to sell a practice is an emotional decision.  When a practice owner offers her practice for sale, she is offering many years of work to the world.  

• Risking investment in property, furnishing, fixtures, equipment and training.
• Slowly developing the value of the business one precious client at a time.
• Long days and nights during tax season.
• Building trust in the business community providing one careful audit after another.
• Advising clients to make strategic business decisions.

When it is time to sell a practice the seller is filled with many complex emotions, some of them will be conflicting emotions.  

• I am burned out, but I do enjoy many aspects of the job.
• I am aging and just can’t keep up with the work-load any more, but I love what I do.
• I am going through a divorce and need to sell my practice in order to divide the assets with my ex.
• My spouse is ill and needs me at home.

We have encountered all of these scenarios over the years.  When a seller meets two prospective qualified buyers, he or she will sell the practice to the one that feels right.  The wise buyer will be sensitive to the feelings and emotions of the seller and the wise seller will be sensitive to the feelings and emotions of the buyer.