Relationship Building and the Keys to Success in Accounting with Michael Meihaus

Michael Meihaus, founder of Meihaus CPA, returns to CPA Life for episode two of this special series. John Randolph picks back up on Michael’s social media post of the 16 things he wishes he’d known when he started his accounting career, and Michael talks more about the lessons he learned from founding his own firm after ten years in public accounting. Of utmost importance is building relationships and having advocates both inside and outside your firm—an overarching framework. Within this framework, he stresses how vital it is to overcome imposter syndrome, to realize that the firm you work for will go on without you if you decide to leave, and to take any advice you receive with a thoughtful grain of salt.

Transcript:

Thank you for joining us today for another episode of CPA Life. And we’re back for round two of our discussion with Michael Meihaus, who is the founder, owner, and managing partner of Meihaus CPA in Escondido, California. How are you doing today, Michael?

Doing great, yeah. Glad to be back.

You came back for a week later for a little bit of more torture for round two, right?

Oh I love it. Yeah, this is fun stuff to talk about so I’m excited for it.

That’s good. As a refresher for everybody. Michael has been in public accounting for about 10 years, right at about a decade. And recently, he left the firm he was with for several years, started his own firm. And shortly after that on both Twitter and LinkedIn, he created a post that talked a lot about several things that he wishes his younger self coming right out of college and starting out on this path of public accounting would have known – is that kind of about the right paraphrase, Michael?

Yep, exactly right. I think I told you last week, I typed it up at 2am one morning, I couldn’t sleep for some reason. And I just typed it up real quick. And I was like, I think this will actually resonate with some people. And apparently it did.

But you probably couldn’t sleep because as a brand new business owner, you’re worried about how am I going to make this thing work? What am I going to do? And the wheels never stop, right?

Yeah, the wheels always spin. So it’s either, you start out, you don’t have enough money, you start out, you have billings and you can’t get cash in your bank account, or then you run into, you have too much work, and then you can’t find people. I’ve just realized there’s always something that needs to be improved, or you’re dealing with. So if you can just accept that process, take a deep breath and work through it, then that’s all about you.

Yeah, you know, I’ve got a brother, kind of talking about,” there’s always gonna be problems.” So years ago, I’ve got a brother that is an amazing, hard working, blue collar guy. And we were talking one day about some financial problems he was having. And he said, “You probably just don’t understand, John.” I said, “Let me stop you right there.” I said, “The problems you have, and the problems I have, they’re the exact same problems, they may just have a couple more zeros on them or a comma in a different spot. But the problems or the problems, they just are, they’re always going to be there.”

Yeah, it differs a little bit—but business is business. Running one is very similar across the spectrum.

It definitely is. And some of the things that we talked about, in our episode last week, they included the challenge of imposter syndrome, something that we all kind of face, am I really the person that I think I am? Can I be successful? Was this a fluke? That kind of thing. One of the other things that we talked about was the need for everybody to help fix the bad parts and, and not just bitch, moan, groan and complain about it. I think that Dale Carnegie’s book, How to Win Friends and Influence People, his saying was “criticize, condemn and complain.” We can criticize, condemn and complain all day long. But that’s never going to fix the problem.

But I gotta tell you, even a week later, as I’ve gone back, and I’ve looked at my notes and listen to the things we talked about, one of the things that we talked about that really, I think, drove the point home of of something that every person in public accounting in that one to five year, one to seven year range in their career, really needs to ask themselves is one of your points that do you envy—if you look at the partners above you, ask yourself, do you envy them? Do you envy their physical or their mental health, their family lives, their work their their work life, balance their priorities, and if not, you might need to find another place to build a career because that’s what your future is going to look like.

Yep. And it’s very hard to buck those trends. If somebody looks similar to all the partners in the firm, then it’s probably because a particular type of work ethic or personality is rewarded. I think that’s what’s really hard to do is to come in and be radically different than everyone else in a firm or a partnership group, and succeed there. So I think that’s something that you might see is that conformity is valued more often than innovative thinking or outside the box type of behaviors or approaches.

I completely agree with you. I think the—again, I think in any industry, there’s always the pushback against status quo, but in an industry like public accounting that has been so ingrained and doing it a certain way, for a century—if you look at the stratas above you, and you’ve got partners and directors that are putting in 60, 70, 80 hour work weeks, you know, their marriages are failing, their relationships with their children are not what you have any desire to have with your children—that’s a pretty good barometer of what your life could be like, and why you’d want to stay and grow roots is beyond me. And I think that shining a light on that is something I hadn’t really thought about. But I think it’s something that is a cry to every person in that space to say, Hey, I think you need to do this. Is it something that you did when you looked at your managers and leaders?

Yeah, actually had a really good, I would say, a good contrast they were people that I did respect and feel that way about and people I didn’t come to that’s I think an important point too is I’m not a maximalist on, you have to leave your firm, or you can’t have a really good life as a part of a firm.

Right.

A larger firm. I think it’s more complex to do that. So for example, you have less autonomy or oversight or input into your life, but you also have resources that I don’t have this as a sole prop for. I don’t have partners I can rely on if something goes wrong, or I need extra help. There are staffing resources that just aren’t available that I can request, I have to go out and solve all those problems, I get to be the IT person, as we’ve discussed, and the admin all those things.

So I definitely want to admit, there are advantages to accounting firms. But I think it’s really hard to break out of the mold of the firm you’re part of. So just be comfortable with that firm. And there are plenty of firms that are different than whatever firm you’re at. So that’s the other option, I’d say if somebody isn’t sure that they’d like to run a firm, there are always opportunities to join different other firms that might do things in a way that resonates with you more.

And I think that, you know, one of the things that I had to learn as a leader running businesses is, the person that helps you get from point A to point B may not be the right person to help you get from point B to point C in the evolution of a company. And your career is very similar in nature, meaning the firm that you’re with right now today may be a great firm to get a strong foundational understanding of the business, but they may not be the firm that you want to grow your career with three, four or five years from now.

Exactly, exactly. And it’s okay to have things for different ages. I think this happens often, if you think about your accounting grads, as they might go to the Big Four for a period of years, knowing that they maybe don’t want to go partner track there. But it opens up phenomenal opportunities, like a lot of the recruitment opportunities you’ll see on LinkedIn, especially— I’m in San Diego area where there’s ton of publicly traded biotech companies—you’ll need Big Four experience. So personally, I wasn’t interested in the Big Four experience. But if you want to go that pathway towards like a controller or CFO, long term in a publicly traded company, more likely than not, you’re going to need some sort of Big Four experience or large firm experience.

Yep. The only challenge I see sometimes is, you know, that person that has this illusion of, I want to grow my career in public accounting. And I mean, let’s face it, coming out of college at 22, 23 years old, did any of us really know what we wanted to do? But the person coming out of college that says, I want to grow my career in public accounting and go work for the Big Four, I’m going to be a partner. And they’re two years into their career, and they’re just completely beaten down. And so now their mindset is, I don’t know what I want to do, I just know that I don’t want to do it here, and I don’t want to do it in public accounting. And I think that throwing the baby out with the bathwater, because not every firm is that firm. And I’m sure that you’ve seen situations like that with your peers and contemporaries in the industry.

Yeah. And that’s really why I like to encourage or counsel people when I’m talking to them to think more in terms of anti goals—there’s a lot—this isn’t my idea, I honestly am forgetting who I’ve read on this topic. But it’s it’s been around a lot is the idea of anti goals. And that what that means is not what I’m going to do, because often it’s really hard to know exactly what you want to do. But instead stating clearly what you don’t want to do. A simple example of that would be I don’t want to miss my kids birthdays, or my family vacations, or be working on weekends. I don’t want to ever work more than 80 hours in a week, or 60 hours, whatever that is. I don’t want to have to travel for work, right?

So all of those anti goals define the types of things that you’re not willing to sacrifice, and therefore you can open it up other doors. But that way, you don’t have to know exactly what you personally want to do. You can just say, hey, in order to live the life I want to live, these things can’t be happening in the background. So for me right out of college, it was I don’t want to work 60 to 80 to 90 to 100 hours a week. I don’t want to spend a lot of time away from my wife—I was just newly married so I believed in investing in the early years of marriage and I didn’t want to have a complete lack of free time. So those things just weren’t conducive with some of the other some of the firm’s you know, that are out there. And that’s okay. It’s nothing against people who choose that path. It just wasn’t for me.

Absolutely. It goes back to I think the saying that I mentioned last week when we were talking that our family has had for years is not wrong, just different. It’s not a path. That’s right. It’s not a path. It’s wrong. It’s your path. It’s my path and it’s just a different path.

So today, what we’re going to do is we’re going to pick up where we left off. We’re going to talk about some of these pretty simple and logical points that I don’t think many people take into consideration when they’re starting a new career out because they’re more focused on, let me get in, let me make a good impression. Let me figure out what I want to do and, and let me be the best at it as I possibly can be. And there’s a lot of value in looking back.

So we got through, I think seven of them last week, we’re going to pick up at number eight. And this is one of those things that when I started out in my career, this wasn’t even an issue because Al Gore hadn’t invented the internet yet. So it wasn’t an issue. But it is a huge issue in today’s world. And that is, “Make content. If you literally put out any accounting content, you’re in the top 1%. Do it well, you’ll open up incredible opportunities, not to mention being able to include ‘internet celebrity’ in your email signature.” So tell us a little bit about that. Because I completely agree with you. I think that we’ve moved to a world where content is huge.

Yeah, it is. And it’s so funny, because I’m such a hypocrite at this. Right now, my content production game has been really bad. And so much of that is because things in the business have been going so well. And that’s something I found often, is when you have the time to create content, sometimes you’re not doing something that interesting. And then when you’re doing something interesting, you don’t have that much time to make content.

But it’s always just a balance of everything. I’ve gotten some phenomenal opportunities off of social media. So I’ve had over at least single six figures, maybe multiple, six figures of direct client referrals from people I’ve met on social media, and relationships I’ve built there. I’ve just met a lot of people that it’s a lot of fun. I went to Engage, the AICPA conference last year, with not really knowing anyone, but I had kind of met a few people online, I met up with them and just built a ton of relationships, open a lot of doors. I’ve been speaking at conferences now, or a conference, hopefully, more coming up soon. And just, you don’t ever know what’s going to happen.

And so that’s what was so interesting about the whole process is it, someone described it as increasing the surface area of luck. And I love that perspective. Because I don’t have like a guarantee that in six months or a year of doing social media, something life changing will happen. But I think if you do it for several years of good content, that you will have a life changing opportunity come as a result of that.

I would say there’s a caveat though, which it’s okay to learn. And your content probably won’t be that good as you learn. But the focus should always be on producing valuable content, meaning you probably have something unique that you can share with the world. Sometimes it’s just experience, maybe you’re not doing something insane. But it could just be the unique experience of starting at a firm and that transition into working for a firm. Yeah, that would be valuable for people who are just starting out themselves, or people who are six months behind, three months behind you.

And also make sure that you’re really focused on just doing as well as you can and not thinking about the long term, financial rewards, things like that. There’s a lot of grifters on social media trying to sell you a course or, you know, scam you in some way. And there are valuable courses out there, there are paid communities that I’m a part of that are absolutely valuable. But for every one of those valuable ones, there’s quite ten nonsense ones. So just don’t be that person trying to sell a course or start a community, first and foremost, offer tons of free value, build an audience that’s engaged because of that, and then long term that’ll allow you to open up these economic opportunities. But first and foremost, free value is the name of the game.

It really is. And it was a mindset shift for me that I had to go through. Because, you know, again, I grew up in the world where sales was knocking on doors and dialing the phone. You know, a handful of years ago, probably three years ago, four years ago, finally, kind of a light switch went off of, hey, knucklehead, you’ve been doing this for three decades, and you’re doing it for the most part, the same way that you did it three decades ago. I’m not going to run a Mensa society meeting anytime soon. But it didn’t take much to figure out there’s got to be a better way.

And doing research, hiring a coach, working through that process—our firm hasn’t picked the phone up and made a single outbound marketing call for our business in three and a half years. And it’s all because of content. It’s all because of social media. It’s all because we also, I don’t think, I can’t tell you the last time we posted anything about selling anything or doing anything from that standpoint, it’s creating value and understanding. You put enough good stuff out there. It’s going to come back your way. It just is. Even if it’s from the standpoint of hey, Michael, I saw a post that you created the other day regarding this and our firm is having a challenge with that. Can I pick your brain just a little bit and see if you could possibly help us?

Yeah, yeah, exactly. And it’s just it’s fun. Yeah. And that’s the other product you should enjoy making content because if it feels like a grind, then you probably won’t do it or you won’t make good content. So it’s okay, figure out your voice, figure out what you enjoy talking about and just take from there.

Well, in kind of the mindset that I’ve had around content creation is—and it’s the same that you can put in place with a lot of things in your life. And that’s progress over perfection. The reality is the people that are really going to care about the mistakes that you make in your content, they really aren’t paying attention. They’re just not.

Yeah.

So you know, if you just let it go, and I mean, your post that you made a few months ago on LinkedIn is a perfect example of us sitting here talking today. I don’t know how many people that post originally reached, but you know, we have an average of probably somewhere in the neighborhood of 4 to 500 listeners per episode over the over the first month and a half of every episode we do, that’s four to 500 people that probably will listen to this, look at this, and go to your website, tried to figure out who is this guy. And those are 4 to 500 people that you would probably never be able to connect with, or sit in front of and make any kind of a sales pitch to.

Yeah. And the way I’ve heard it described, which is so well put from someone else, is that it’s asynchronous, meaning every sales call or outbound lead that you do you have to do it in that moment. But this podcast will exist in perpetuity, just like that LinkedIn post existed in perpetuity. I think I posted it well before you reached out. And so it’s such an amazing way to build up essentially a library or a giant bank of your personality, your knowledge, your wisdom, that then people can access whenever they want without actually taking your time. That’s the most amazing part.

I think, if I remember, it was close to like 60 or 70,000 impressions. I don’t know what that means with LinkedIn. But it went a lot bigger than I thought it would go. And LinkedIn back then I’m sure it’s still the same, but was really good for like, perpetuating content after 24, 48 hours. And so Twitter, it’s kind of gone and done, you know, in 48 hours, but LinkedIn will be like, hey, did you see his great post four weeks ago? Like, it’s pretty, pretty great for that sort of thing.

Absolutely. And you know, you think about it again, 60 to 70,000 impressions, how long would it take you as a business owner, and also business development person for your business, how long would it take you to connect with or make any kind of impression with 60-70,000 people? You don’t have the time to do that.

Yeah. And that’s such a great point for when things don’t go well, like you might say, oh, man, I’m never gonna get 70,000 people to look at my posts. Often I get like, maybe 800 to 1500 impressions on like, a standard tweet, unless it like, really clicks and resonates. But it’s so easy to think, Oh, it’s 1500. But 1500 eyeballs on what you’re saying or here is like think about it in terms that’s like five massive lecture halls and a giant university. Like it’s so easy to just kind of blow off these numbers. But when we think about thew rationally, in what context, would I ever speak to 1500 people and have them tune into some

Yep. And I will tell you there are, there’s a handful, I would say probably four to five people that our staff to senior level associates in public accounting firms today that I follow on LinkedIn, that are one to five year level people that are posting some good stuff. But more than that, the interactions that they’re getting from firm leaders all over the country. I promise you when those guys I say guys, there’s a couple of ladies, when those people decide, six months from now, eight months from now, two years from now, to make a job change, I promise you, their job change timeframe is going to be short, because their network is going to know who they are. And if those people send out a message to a handful of leaders that I know, follow and constantly comment on their content, if they send out a message and say, hey, I’m thinking about making a change, there’s probably a handful of people that will say, let’s talk.

100% people want to work with you. It’s this very odd, like spotlight phenomenon where you get like this micro celebrity like I’m just a guy in Escondido, who does benefit plan audit. So, but people like really like to interact with content, and they enjoy when you interact back. That’s my favorite part of it is just meeting and interacting with people. So I’ve had people who would love to work with me in the future. Work on like software projects, it’s just amazing, the doors that open so I would highly recommend to anyone, if you have any inkling of doing it.

Kind of segues nicely into the next point that you made, which is “Business development is key. Like it or not, if you bring in the money, you get paid and have the most opportunities and accounting some are naturally gifted at what others have to learn whichever one you are, it’s a critical skill to master.” Is that something that that came easy to you? Or is that something that you’ve had to work on over the years?

It’s so interesting—it was hard, but not as hard as you think once you know how to do it. And so at the risk of sounding like—I’m not going to sell you a course that will make me not immediately not a scammer—but I’ll tell you a few secrets of business development. One thing I think that helped me out a lot in this was I worked in a family restaurant as a server, a waiter for like six years during high school and college. So you have to just learn how to make small talk with people. And you have to make people feel welcome and heard and then interacted with, on these really short bits too. So get really good at just making small talk conversation, engaging with people quickly, because you’re running around, it was like 12 tables, we were waiting at any given point, had crazy lunch rushes.

So that was really important for my development. Before that, I would say I was more like a little introverted and didn’t really feel comfortable talking. And so after that, it just completely blew that part of me wide open. I learned that gift of small talk. And then I learned from a lot of just books and things I read about how to ask questions and listen to people. So the secret for getting people to like you is this, I’ll tell you a few secrets. Because I really enjoy business development I’ve had some good success at.

First is just, ask people questions about themselves. I like to describe myself as a person who has like a gigantically shallow lake of knowledge. Like I have a little bit of knowledge of a ton of topics—and my goal is always that I can ask one intelligent ish question for most subjects. And then if you ask one intelligent question, let them talk and then continue following up questions and be genuinely interested—again, don’t ignore them—if you do that somebody will love you. Because people love to talk about what they care about, they love to feel interacted with. So just ask one question, ask a bunch of follow up questions, and you’ll never have a problem talking people. So that’s step one, if you can do that, then people will learn to like you.

And if people learn to like you, they want to do business with you. That’s honestly what it comes down to. People think it’s really complex. And it’s not, it’s often, it takes a while, which is hard. So that’s the second thing I would say if you want the sales secrets here is that you gotta really anticipate like a one to three year timeline to get business out of people that you build relationships with. So I always tell people that the beginning of your business will be the worst, because you’re going to be so desperate for sales, it’s going to come off. And it’s just like when you’re trying to date or anything like that. Desperation smells, and everyone can smell desperation. And the way you talk and interact with people is influenced by desperation. So I would tell people don’t be desperate, recognize it’s a one year to three years, and you will literally see like this slow increase, slow increase, and then a hockey stick of referrals of business done after you build those relationships.

So focus on getting people like you through genuine connection and communication and interest, have that long term timeline, and then three, this is the really, the phenomenal tip I learned from my old boss, is find out who the key referral sources are in your business. Meaning there are a group of people who meet with your clients, your future clients, and know they need your services first. Who are those people, and build relationships with them. For me, it’s investment advisors, third party administrators and sales reps at the large record keeper houses because they sell a plan, oops, it needs an audit, they call me an investment advisor takes over a plan or they find a plan has been delinquent, they need it cleaned up quick, they call me. TPAs have a client that go over the limit, they find out while they get their employee census payroll data, they call me. So just do that. And if you get in good with those people who know it and who refer first, then you’ll always get the business.

Absolutely. You know, we the whole concept of asking questions is, it’s the art of conversation. We listened so much with the intent to respond versus listen with the intent to gain knowledge and information. And I was adamant that my girls, when they were growing up, I would joke and tell my wife, they may not know how to add two plus two, but they are going to know how to interact with other human beings. And we played a game every year at Christmas. We live in outside of the Dallas area all our family’s in the Houston area. And and I would tell him look when when you go to we had two big Christmas parties you went to every year and I would tell them look, your job is real simple. You are not to tell anyone anything about your life over the last year, unless they ask only if they ask your job, though is to ask about everything they’ve done over the last year, learn as much as you can about them, about what they’ve been doing over the last year, your cousins, your aunts your uncles, everybody.

And after about two or three years, it started to annoy my girls that we would leave those parties and they would say nobody asked about me at all. Nobody.

Yep.

But they could sit there and tell you all about what was going on with the lives of their cousins and their aunts and their uncles. And what came out of that though, was inevitably how many times we heard back from aunts and uncles, “We absolutely love your kids. We love to hear about what they’re doing. We love to hear about their lives.” And it’s all I can do as a parent to say, well, you really didn’t hear about their life because you never asked them about their life. But they asked you all about yours. And it’s taught them now as grown adults. The importance of asking questions, engaging in conversation and showing a genuine interest in other people’s lives.

100%. And what’s interesting is your daughters’ feelings, if you can just realize that’s universal. Everyone’s just waiting for somebody to ask them about themselves. So if you can sacrifice your need to do that, and instead flip it around recognizing other people’s needs to be asked those questions, then you’ll be popular. I challenge everyone to look at like, why do the people you really like why are they the way they are? And I bet you, there’s somebody that takes like a genuine interest in you. They look you in the eye and they like smile and get excited about whatever you’re telling them about. I think if you really start to pay attention, you’ll pick up on these little cues.

Yep, I agree with that. I think you absolutely will. Talking about little cues. The next point that you made in your list was “Play the goofy games, or don’t. Hours and budgets are ridiculous and manipulated metrics. But for whatever reason, they are important to many firms. Make sure you understand the dynamics at your firm, you need to play the games or find a place with games you like better.” Was that something that you had to kind of wrestle through in the firm you were with?

Yeah, thankfully, they weren’t hardcore on hours. But there would just be goofy things where it’s like, well, you didn’t meet your hours. It’s like, well, I did business development and brought in 150,000 of work. Like, well, that’s great. Or I onboarded an entire team in India that helped, you know, do a hundred of these audits. So there’s just not a realization for different efforts at a firm. And it usually gets smoothed out over time if you become a partner, right? Because hopefully, your really talented people who do all these extra things will become a partner. But for me, it’s just such a goofy model to say you got to work really hard and go overboard and above and beyond for ten years, and then you get the reward.

That just, one that doesn’t seem to be consistent with any sort of like delayed gratification capability that anyone has other than maybe CPA firm partners. But more than that, I just have the question fundamentally of like, why, and it’s because it’s a lot easier to track hours or realization. They’re just simple. And so it comes from a place of, it’s really complicated and hard to properly compensate people without using those types of models. So 10 times out of 10, it’s just easier.

I actually talked to like an emeritus CEO about this from afar. And I was just like, it just seems so utterly ridiculous. I was like, you can manipulate these. So for example, if you lower your billable rate, your realization and profitability goes up. If you increase it, then it goes down. If you work fewer hours, if you just eat hours, then your profitability goes up. But your utilization goes down. He’s like, yep, he’s like, you’re absolutely right. I was like, Oh, good, okay, you’re not all crazy. He’s like, yeah, it’s just the easiest way to coordinate efforts across a large organization. He said, these metrics are goofy. That’s not his words, they’re mine. The metrics, he said, are too easily manipulable, and don’t really tell the story. But it’s hard to coordinate people over a large organization without these generic, objective metrics ultimately.

That’s just what I learned. And it’s okay. Some firms have done away with billable hours. And I love that I really prefer more of like a revenue production model, meaning that each staff is responsible for producing a certain amount of revenue, and they get a bonus on amounts over that, or they can have reduced salary if they want to work less, whatever it ends up being. And I think models like that make a lot more sense. Because the firm ultimately wants to have cash profit, right? We want to have invoices that are paid and end up in our bank account. And at the end of those and pay our expenses, we want profit, you know, without, without all the accounting metrics, whatever, we just want to have cash profit for our firms, and revenue over fixed salary expenses is the easiest way to figure that out.

Yeah, it’s interesting, you say that I did a podcast with a firm that, ironically, is a California based firm, that was recognized as one of the top firms in the small firm category last year by Accounting Today. And that’s exactly the model they have. And they’re not a little firm. I mean, they’re, they’re a decent size, 60, 70 person firm on the west coast. But that’s kind of their model. They don’t look at hours, they don’t have requirements for minimum hours for their employees. They understand that everybody’s kind of at a different level. And they kind of work with people to understand what is what does your output ability look like going into busy season. And then each person is measured on what they feel like they’re comfortable committing to, from a, you know, really a ultimate revenue perspective.

You know, if you feel like you can work 22 hours a week, because you’ve got things going on at home, and you’re a part time employee, or you think you can work 42 hours a week? Well, at your average bill rate that’s X. So you know, we kind of expect Y for you to generate over the next three to four months. And here’s the bonus carrot, if you do that.

Yeah.

And if you do Z, you know, if you do you know, Z or A or B or C, that carrot gets bigger, if you can do that.

Yeah. And I love it. It’s just, it’s typical of other compensation models, like sales incentive type of structures, like any sort of piecemeal construction type of method, like it makes sense everywhere else, but accounting is like, can’t possibly work here. I think it’s because we think we’re fancier than we really are. I told a professor, an accounting professor, I thought that accounting should be a trade school. And it’s really interesting because if you look at the history of what the AICPA is trying to accomplish, they tried to get away from that sort of designation. But we’re a trade essentially, I really believe that we’re a trade.

Yep.

And that we have specialized skills that need to be taught on the job, and that the actual educational component of the CPA journey is not as beneficial as we’d like to think it is. So I think given that, it’s like, well, why don’t we kind of model and steal some of the great ideas from these other really successful areas of the economy? So I’m gonna get in trouble for that one. But I’ll stick by it.

Well, you know, all of these and I don’t know, at two in the morning, when you wrote these down, if there was a train of thought—when I say train, I mean, a connecting train of thought, because it kind of rolls nicely into your next thought, which is, “Accounting firms are essentially functional Ponzi schemes. If you become a partner, you only get to buy out and make money. If you’re able to convince the next generation to work with you. Will you be able to do that at your current firm?” There’s a lot of truth in that.

People got really mad about that one, too. But here’s the empirical example: you have a massive wave of single or multi partner firms that cannot get anyone to buy their firm out. So how much is your firm worth today if no one will buy it? It’s worth zero, no great, great cash flowing business, but it’s not an asset at that point. It is something that only survives once you convince someone else that your asset’s worth buying, you know? So yeah, I got some flack about that one, but I stand by it. So functional, which is important. Not everyone’s getting scammed. It’s just a functional Ponzi scheme.

No, you’re right. I think you’re exactly right. And to your point: So I play music. Probably three, four weeks ago I was talking to a guy, this lead guitar player in a band that we play in, and he said, hey, I got a question for you. Can I have my CPA call you? Like, yeah, what does he need? Does he need help with hiring somebody? Nope. Don’t need help with hiring somebody he’s looking to get out of his firm. And he’s tried to sell it for the last two years, no one’s really interested in buying it. So what he’s looking for is he wants to ideally find somebody that he can give the business to, they can take it over. And I mean, I don’t know how long the guy’s been doing it. I never connected with the guy. But, you know, I told him, I said, look, I’ve, I’ve probably got a handful of people that I would be more than happy to put him in touch with, who would either take over his business, or maybe buy a piece of the book.

But yeah, and that’s what’s amazing. It’s an incredible time if you’re on that person who’s trying to buy these businesses, there’s leverage right now, like, traditionally, books have traded maybe 80%, of book to 110% of book. With some of these smaller practices, that would be a wonderful lifestyle firm, you know, for somebody with a little technical savvy and who got it organized and recipes. I mean, you can easily make $2, $3, $4, $500,000 a year and not have an insane workload. There’s leverage there. If you’re interested in starting a firm, there’s a ton of opportunity out there, because of the way that everything’s structured.

Yep. Next point, “Make friends with everyone. People acknowledge people inside your firm, people outside your firm, people you meet at events. Having genuine relationships is one of the most rewarding parts of this profession and will open up the most doors.”

Yeah.

I think that’s very, very true. It kind of goes back to the networking and business development side of things.

Yeah. And networking is such a, ugh, I hate that word, like, because I hated networking. And I always dreaded networking. So that’s why I really said before about the whole, just ask questions of people, just think of it as relationship building. That is, ultimately your network is the group of people who you have genuine relationships with. So if you just take out the word networking, just go to conferences and say, hi—you literally, here’s your script—hi, my name is Michael, I work in blank, what’s your name? That’s literally your script. And then let them talk a little bit. They’re gonna say something, and you’re gonna ask a question about it. And that’s networking. It’s not as weird as you think it is. Or you’re sitting in a group of people and somebody says something interesting, like, Oh, I’ve never heard of like these expat tax services. Could you tell me a little bit more about that? I have a sister who lives overseas, you just literally just that’s all you do. And now you’re networking, you’re making relationships. And it’s so much fun.

I literally just met up with a couple of people from Twitter at Engage last year. And I literally ended up spending the whole night just going around to the various like, events or parties, we all hung out. It was amazing. But it was just because I had reached out and they were super friendly and super gracious to hang out. And we had a good time. And it only happened because I said, hey, are you guys here? Let’s meet up like those sorts of things only happen because you start building those relationships.

And I think that if you go into it with a genuine interest of learning about who people are, broadening the horizons of your knowledge and your sphere of influence, but don’t do it from the standpoint of selling, don’t do it from the standpoint of potential business. Don’t do it from the standpoint of what’s in it for me. It goes back to the mindset of creating content and giving things away. Whether that’s knowledge or product or whatever it may be. but if you go into it with that mindset, people walk away. I know I do. And you probably are the same way people walk away from those interactions going and that Michael guy was a really nice guy and on top of all of that, he didn’t ask me for a single thing. He didn’t try selling me anything.

Yeah! Don’t try to sell people anything! It ruins the whole experience. Yeah.

Yeah. It’s kind of like those LinkedIn connections that you’ll begrudgingly say yes to. And you know, you know that as soon as you say yes, accept it, within minutes, you’re gonna get that response back of, you know, hey, I’m a financial planner. Have you ever thought about putting together a financial plan?

Yeah.

So it’s, you know, understanding that talking to everybody is, is making friends with everybody is just that it is it is genuinely making friends. It’s not what’s in it for me.

Yeah. If your sales pitch is happening within like, a month of meeting the person, it’s coming way too soon. The first like 12 interaction should just be relationship building.

Yep. I completely agree with you. Your next thought was one of those things that I don’t think anybody wants to acknowledge, recognize or admit, but it is the truth. And that is, that “your current firm can and will go on without you.” That’s something that I don’t know if it’s just a grandiose mindset that we have that, you know, they are lucky to have me. But the reality is, they were here—I’ve said it for years for people that work for large firms—they were here before you got here, they will be here long after you leave. They may miss you. But they’re going to move on without you.

Exactly. And when I left my firm, I then again, I think I mentioned the last one, I had a very, really cordial departure from my firm. I love all the people there. They were super supportive of me in the transition, I tried to be as supportive as I could in the transition. But I gave him some thoughts like, oh, hey, I think you should do this, this and this. They did some of it. They said, no, that’s not the approach, we’re gonna take some of it. And they ended up, guess what, surviving the firm is doing great. The benefit plan on practice looks different than when I was running it. But that’s natural and the firm’s making money. The firm still has partners, the firm still has clients, they still have employees, like nothing collapsed when I walked away.

And so I think often we can prevent ourselves from having real opportunities, or keep ourselves from doing something we think we should do, because we’re so worried about what will happen to my team, and what will happen to the company, and oh, man, this will never work without me. And absolutely, well, it can be painful, like believe it. It’s not that it isn’t painful. But ultimately, if they had to lay you off tomorrow to make the firm survive, they would do it like that’s the nature of business.

And so often I think loyalty can be misplaced. I think a lot of good firms would try not to lay off a bunch of people. But if push came to shove, we can’t make payroll tomorrow, because of economic declines, firms lay off people, and it’s so it’s the exact same thing, from your perspective, there’s a better life opportunity, or your mental and physical health are at stake or your relationships are suffering because of work, then you need to be willing to do the same thing for your firm, and they’ll make it through they always will make it through.

Yep, they will find a way to move on. Like you said, it may be painful, it may be hard, but they are going to find a way to move on. Great. My my mantra has always been it’s not that you leave. It’s how you leave. Exactly. Do it professionally, do it above board, it doesn’t matter how you were treated doesn’t matter. You know, how toxic that environment may be? Be the one that’s above the fray. Be the one that stands out, that sets the tone while you’re there, and when you leave, because that’s really what people remember, they remember how you left.

Yeah. And they may refer your first few clients, or I’ll send them work on like the website. So it really is beneficial. And so much of it has to do with just that we both treated each other well, during the departure. And so it goes both ways. And I’m grateful for that.

Yep. Your next point. And I think that your second line to it is really even better than the point. So the point is, “Politics matter. That’s kind of gross, but true. Life is a lot harder if you don’t have people in your corner fighting for you.” Very true.

Yeah. There’s a story that made me think of that too. There was an individual that didn’t particularly like me, and actually wanted to have my offer rescinded, at my firm. And I had a partner who really liked me, had a good relationship with me. And he came to me and explained it. He said no, he said, we’re keeping your offer. He says I know you but I do want you to know like what happened in this interpersonal situation that made this person think and feel this way. So it was a very like, not only did I have someone in my corner, who helped me in a tough spot, when there’s like some political maneuvering going on behind me, but that person cared enough to also say, hey, there might be something worth considering. The conversation would be like, Hey, I know who you are. You do great work. I know you personally out stuff. And also, these things might be why you come across this way.

It is such a great learning moment for me personally. But also yeah, if I didn’t have somebody in my corner would I have ended up keeping the job? I really don’t know. So yeah, better to have people that like you that people don’t like you.

Those little things do matter.

And if politics feels dirty to you, sorry, just one thing that then don’t focus on politics just like you don’t focus on networking. Have genuine relationships with people throughout the organization. Because if you have genuine interactions with a ton of people, then something might come up where there’s a problem and 15 people will say, No, I’ve worked with him in the past, like, I know his work product, I know His character, then that’s what it is. There’s a clean version of politics. And then there’s the dirty version of politics where you’re going behind people’s backs and try to influence things in play power games. I don’t play that game. But the clean version of politics is to make sure you have advocates and allies and every quarter of the firm.

I completely agree. And I think doing doing all you can to build those relationships, create that network, it is only going to further your career, because one of the questions that I always ask candidates, when I talk to them in any market that I’m working in, but I’m—most of the work we do is on the Dallas marketplace—one of the things I’ll ask every single candidate is, I have a question for you. When my client picks the phone up, and calls the firm that you used to work for, what are they going to hear?

And before you answer that question with, well, they said they’d give me a reference. That’s not what I’m talking about. What I’m talking about is when my client, who’s the managing partner of this firm, picks the phone up and calls his buddy that he plays golf with every other week, or his buddy who was a partner over there that he went to college with, and they celebrate Christmas together—he’s not calling and saying this is a formal reference.

Exactly.

He’s calling to say hey, I just interviewed a guy by the name of Michael Meihaus. He worked for you two years ago. Tell me about it. It’s not about a reference. You tell me about Michael. And what does he get to hear?

And this stuff happens. Like, it’s probably not legal, technically. But this stuff happens. And that’s what’s important for people to realize that people call their buddies that they play golf with they call their old co worker, like all this stuff happens.

Oh, it happens.

Questionable legality, I think there are rules about that, but it happens. So yeah, just be aware of that.

It absolutely happens. I’ve gotten a couple of calls over the years from people that know that we work with certain firms, and I’ve had people call me and say, hey, I have a question for you. I just interviewed a candidate on my own. He used to work at this firm over here. Can you do me a favor and put me in touch with somebody over there that can talk to me about him? Or can you call and find out about him for me?

Sure.

It absolutely happens. It just does. Next last point, “Strive to make things better. Leave your mark, not for the firm, but for yourself.”

Yeah, I think it comes down to work quality. So there’s these two competing thoughts. Like if you go look on Reddit and read the antiwork, there’s like a frustration with the work environment and how corporations and large employers treat people, which I think is very valid. I think there’s some significantly questionable practices across the economy. But there’s a point too, where you should just do excellent work, I think because you’re practicing either excellence or poor work product.

So if you practice poor work product, then you’ll probably get in the habit of doing it. If you practice excellence, even if you’re not rewarded or recognized for it, you’ll probably become excellent. So I think that if you’re unhappy at your current place, look for a different spot. But always try to practice excellence, because you’re either getting in the habit of good work or bad work and get in the habit of bad work, it’s only going to impact you negatively.

One of my mantras for years has been how you do anything, is how you’ll do everything. There’s a lot of truth to that in what you’re saying. Because so many times we validate putting forth our best effort because it’s not being reciprocated, in our opinion—valid or not—it’s not being reciprocated this way, I can’t control what’s coming at me. But again, the word that I use with my daughters for years is you may not be responsible for what’s coming at you. But you are absolutely response-able at how you react to it.

100%.

I like the fact that the way that you word that strive to make things better, because so many times we sit and tear down and tear apart and want to point out all the problems. I worked for a boss years ago, and we’re sitting in an executive meeting one day, looking at some restructuring we were doing and myself and the other two RVPS. We’re going through this with him. And we listed out all kinds of things of why it wouldn’t work and he set us up. Tell me why this won’t work. And we list off all kinds of stuff. And he counts so many. I think it was like 15 reasons why it wouldn’t work.

And he said okay, now here’s what I need you guys to do. I need you to go sit down and figure out 30 reasons why this will work. Two reasons why it will work for every one that it won’t. I mean, it took us a while. We came back a couple of times said hey, I can’t think of 30 Sorry, too bad. Go figure it out. I need 30 reasons why this will work.

Yep. Absolutely.

And it’s a mindset shift.

Last point, “Take advice with a grain of salt. There are tons of perspectives on the right path. When you get advice on your career, ask, what incentive does the giver have? We all have blind spots and biases so maintain professional skepticism.”

Yep. And that includes myself. I think I put in—I think I even put a little cheeky thing in there that includes this, because obviously I quit a firm to start my own. So I have a cognitive bias, essentially, to affirm that choice. So just recognize that professors at schools who want to have a high Big Four, you know, whatever to send rate or CPA pass rate will push you a certain way. Partners who want you to stay in their practice so they don’t have to go hire someone else will push you a certain way. You know, you might come from a family where parents have certain expectations of your performance or your career capability. So just recognize that everyone has perverse stated or unstated incentives and what they tell you to do, including myself, right? I’m not selling a course yet, maybe I will be. I’m starting a firm. And so know my perverse incentives, right? So just take it all with a grain of salt, get multiple perspectives, and don’t discount your intuition.

I think if you sit there in your desk, and you know that you’re miserable, why would you try to convince and logic your way into the fact that you’re not miserable? You know, or that if you’re, if you have a passion or drive to go do something, why would you convince yourself out of that? I think it’s really good to be practical, set yourself up for success, have some money in the bank, or some support structures, but ultimately, just recognize there’s a ton of different paths. And I hope I represent that I don’t hate on the large firms. I don’t hate on staying in a firm your entire career and retiring a partner. There’s, there’s a lot of broad experiences you can have that will give you a wonderful path, just make sure it’s the one you want.

Absolutely. You have to find the right one that you believe is the best course for you, personally, professionally, all the way around. I know that with so many different angles that we’ve talked about, you know, these last two episodes, there’s obviously points that resonate with different people. So if someone is interested in learning more about you, the road that you traveled, picking your brain on on what steps to possibly take out to build their own firm, or, hey, I’m stuck in my career, and you took this step, how did you go about doing it—what’s the best way that somebody can get a hold of you?

I’m pretty active on Twitter. So it’s just my first name, last name, which I think should be in the show notes or something like that. And I can send you it so you can throw it in the show notes. But I would just go to @MichaelMeihaus and I’m on Twitter, I’m posting pretty regularly, I try to answer any DMs that aren’t selling me something. So please don’t sell me something. I’m probably not buying. But yeah, love meeting other people or comment on posts. I always respond to all of them. Happy to help anyone however I can.

Wonderful. Michael, I want to thank you for spending some time with us today and catching up with us from the episode last week and really giving us some points to consider when looking at the world of public accounting, or for that matter, a new career endeavor that that someone might be considering in any industry, because I think there’s a lot of these that play out across multiple industries.

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