Building a true one-stop advisory firm

You’ve heard the advice that clients want multi-advisory services from their accounting firms. But what does that actually look like in practice? In today’s Q&A, Sean Duncan, CPA, shares how he launched his firm, SMD Consulting and Accounting, LLC, to incorporate wealth management and legal services. But the path there wasn’t a straightforward one. Find out how Sean successfully navigated compliance and client expectations, plus how checking off a bucket list item also helped his firm’s largest niche client. 

—Interview by Lauren Ward, edited by Bianca Prieto

Research is constantly showing that accounting clients want comprehensive advisory services. Your firm offers much more than accounting and tax support—you also bring in wealth management, legal services and insurance. Did that happen organically over time, or did you launch with a full suite of services? 

The answer to that comes with a little bit of a story. When I started the firm, I named it SMD Consulting and Accounting with the word "consulting" first because I wanted to focus on the value of advice over compliance. We were going to be different because we focused on helping in ways that traditional firms don't. Back in 2006, advisory wasn’t the widely discussed topic that it is today. It was just something I saw that clients kept asking for, and I saw that I had a skill set that could fill the need I was seeing. 

Over time, we accidentally started slipping back into becoming a more “traditional” CPA firm because we were so successful at landing tax preparation clients. In other words, we started disappearing in February, March and April, and again in August, September and October because those were tax seasons and our "success" demanded our attention. However, we had strayed from our mission and purpose of providing the consulting. 

Sounds like you lost sight of your original objective. How did you overcome that?

In 2017 I blew the whole firm up and repositioned everything to focus on advisory services. I literally fired 2/3 of my revenue by letting go of our tax-only clients to fully commit to our mission. That’s when we very intentionally developed fixed-fee-related services and the structure we use today to proactively advise clients on business and tax topics.

We later added the wealth management and legal affiliations because we kept running across issues with financial advisors and/or lawyers doing things to screw up the tax and business planning we were doing. Clients were frustrated with the advisors and lawyers because they didn't consider the tax implications, and we were frustrated that they didn't communicate with us so we could help those clients. Since trying to force those businesses to change their approach, we pulled things "in-house" to have better control. Overall, it’s a better way to serve our clients. Now we help them with all aspects of money. We help them with how they make the money (the business and tax planning), how they use the money (wealth management) and how they protect their money (legal services).  

So the advisory purpose was always there from the beginning, but it took us a while to create the right model that helped the clients in the way that they wanted to be helped. 

What has been the biggest challenge in incorporating other services outside of accounting and tax support, and how did you overcome it? 

There are definitely compliance-related hurdles to make sure that we’re following all the proper rules. 

By the way, I keep referring to the wealth management and legal services as our affiliates, because those are all separate companies. For example, I'm not a lawyer, so I cannot offer legal advice; our affiliate law firms do that. Similarly, we don't offer investment advice in the accounting firm. That has to be handled only through the registered investment advisory firm that we work with. We have to navigate these rules set out by various licenses, governing bodies, etc., but that's not the most difficult part.   

I’ve actually found the most difficult thing is getting the clients to understand that we really do all this stuff through SMD and its affiliated firms. The ultra-wealthy get these kinds of services from family offices, but the rest of the public doesn't have a standard model where tax, law and wealth management can be handled in a virtual one-stop shop.

In fact, the public at large is still brainwashed to think that accountants are just there to fill out tax returns for them. We’re having to retrain some medical practice owners and business owners that the value proposition is more than just getting a return done.

It’s a weird paradox that the public wants advice and strategy from the CPA, yet they don’t quite know that the CPA can do that kind of work and create the value we create. That’s slowly changing, but it’s taking its sweet time. I know we create a tremendous amount of return on investment, but educating the public on that is a process.

You recently published a book, Tax RX: The Self-Employed Physician’s Tax Guide. What made you decide to write a book?

First and foremost, it was a bucket list goal of mine. I am a huge fan of setting goals and tackling my personal bucket list, and this is something I’ve wanted to do for years and years. While I really wanted to create a book that brings value to others, it was a personal achievement item first. 

The reason I wrote about this particular topic was that it was information that I constantly teach and share with medical practice owners, employees, friends, etc. I know this stuff backwards and forwards, so I just took all the information that I have been saying over and over again and put it into a book.   

What shocked me the most was that it was actually relatively easy to write because I just wrote it like I would say it in a meeting, in a webinar or on stage at a conference. My fingers just took my words and put them into the pages. Fortunately (or unfortunately, depending on your perspective), all my dad jokes and goofy references also joined those pages while I was writing.  

How did you choose your target audience of self-employed physicians out of all the types of business owners you work with?

Strategically speaking, I specifically wrote it for physicians because they are the single largest client niche for SMD Consulting & Accounting, LLC. It just made sense to write a book for our largest audience. Additionally, doctors get almost no practical business education in med school, but they are often thrust into a self-employment role with a LOT of money at risk.

Business and tax mistakes are expensive, and sharing the information in this book should help reduce the waste so they can better use those resources for vacations, investments, gifts for their kids, charitable endeavors or whatever passion they have.

(Pssst…but I have a secret for you.. the information in the book applies to all business owners, not just physicians.)

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The Net Gains is curated and written by Lauren Ward and edited by Bianca Prieto.