2025-09-24
Opinion: The Rise of Private Equity within the Accountancy Service Sector
Mariola Bonnici
Head of Practice, EU Finance Team Builds
Mariola@Caminosearch.com
Mariola leads the European team build and finance practice at Camino Search, overseeing the mid-senior finance practice across the Private Equity and Venture Capital backed Technology, Renewable Energy and Consultancy space. She is passionate about innovative and sustainable technology businesses, starting her career working within a circular economy start-up as it scaled. She holds an honors degree in History and Legal Studies (BA Hons).
(Image Credit: Media Modifier here)
Historically, PE investment in the UK has largely focused across the Technology, Healthcare and Manufacturing verticals, however, with dry powder and valuation for technology assets remaining at record high levels investors are looking elsewhere.
Traditionally, the professional service sector has been driven by legacy and partnership models crucially defining the stability and recurring revenue streams of the sector.
Alongside, the potential for significant technological in their practices and the bridging of a fragmented market it’s a brilliant opportunity for investment.
In recent years, we have seen the Big 4 carving out arms and divisions in the run to profitability, senior partners going solo and obtaining investment, and the consolidation of the SME market into regional hubs.
With over 100 transactions in across Europe for Q1 what’s next for investment and what will be the crucial drivers for success?
Accountancy Services Spotlight
The consolidation model – ‘To consolidate or not?’
Regional and SME firms have a strong hold of their markets due to the intimate relationships they build with customers.
This is an invaluable relationship and has typically enabled them to maintain their hold. This becomes one of the trickiest obstacles to overcome when embarking on the consolidation path.
However, when this relationship is prioritised with entrepreneurial flair and technological advancement the consolidation model is very successful.
Diversification of Services
With access to external investment traditional firms are showing a larger appetite for diversifying and cross-selling opportunities.
For example, it’s becoming apparent that the traditional accounting firms are expanding into legal, tech and wealth management offerings.
Disruption of Traditional LLP Partnership Models
Will this cause a culture clash? Will this attract new talent? How will the LLP model be disrupted? LLP models have certainly proven crucial to business growth within the service space however this isn’t typically the norm PE ownership is used to.
LLP structures have been crucial within the space to maintain tradition and long-term client relationships and revenue. However, LLP structures do provide a slight hurdle to the acquisitive nature and growth the PE industry nurtures.
The disruption may present a new wave of partners incentivised by IRR metrics and earn out periods and Holdco share options, but will this be enough to disrupt legacy and tradition?