Unique CPA Rewind: An Innovative Approach to a Traditional Profession

Today, our guest is Josh Lance. Josh is the Founder and Managing Director of Lance CPA Group, which is a virtual CPA firm based in Chicago. His firm focuses on providing accounting and consulting services to a few niche industries. He is not only a CPA, but also a chartered Global Management Accountant. In his early career, Josh with a national CPA firm, before working as a controller at an ultra high net worth family office. Josh has been honoured by being selected to the 2017 class of the AICPA Leadership Academy, and CPA Practice Advisor has named him as one of the 40 Under 40, in not only 2017, but 2018 and 2019. Josh was recently appointed to the Illinois CPA Society Board of Directors and the AICPA PCPS Executive Committee. In addition, he is an adjunct professor at Northwestern University—and I can go on and on, but I think at this point, we need to let Josh speak. So Josh, welcome to the show.

Thank you for having me.

I really appreciate you being on, and I think it was meant to be—at least on my end, when I first started the podcast I had been asking around if there was any interesting people that I needed to talk to about having the interview on the podcast. And your name came up two different times from two separate people on two back-to-back days. And I thought, “Well, okay, this is not just coincidence, we’re gonna have to check into this Josh Lance guy and see what he’s all about!”

So you were nice enough to—I think we did get an introduction email through someone else—but you were nice enough to, to agree to let me give you a call and talk to you about the show, and then you’re nice enough to get on. So I really appreciate that.

I’m glad to do it.

I’d like to jump into it. There’s a couple of things that I’d like to talk about. In that intro, there’s a few things that stick out to me. The first is, I was just curious about starting the firm. Fou were in public accounting, you left public accounting, and then you decided to get back in. But not only get back into public accounting, get back in by starting your own firm. I’m just curious how that whole process went about?

Yeah, so I was in public accounting for a number of years, I had left there, you know what people leave public accounting for—went to the corporate world to a family office. But then that family office had decided to change its headquarters from Chicago to San Francisco. And at that time, I had a young son and did not want to leave the Midwest. So I had some kind of time and runway to kind of figure out what I wanted to do, and I’ve always been kind of an entrepreneur at heart. And so I was kind of kicking around, like, ideas about starting different types of businesses and what I could do, and then it really kind of came down to like, “Well, I know accounting—I’m an accountant. What if I started a CPA practice in kind of the way I wanted a CPA practice to look, and try my hand at that?”

And so, and that was really kind of the jumping off point there was really, having this kind of opportunity to kind of make this change, and kind of make a leap of faith in starting a practice and kind of trying things the way I would want to do it, and the way I thought firms should do it, and seeing how they go.

So we’ve been at it for about four and a half years now. And it’s been going really well. We’ve got a really great team on board now that we’ve hired, and work with a lot of great clients and we’re really kind of building the firm that we want to build.

I think that’s great. I’m just curious about when you did that, from day one, because we mentioned the intro, that it’s a virtual office, although we said virtual office headquartered in Chicago, so obviously, there is a space, but from what I understand the virtual means that all your employees—everybody that works with you—works remotely, and it’s all based on technology to keep everybody connected. Is that it? I guess, what is a virtual office? Am I in the right place?

Yeah, I mean, I think that’s, that’s really kind of, that’s basically it. When I started the practice, you know, back in public accounting, I traveled a ton. I was on the road all the time. And I did not want to do that again. And so as I thought about how I would service our clients and what ways I’d go about doing it, just looking at the technology available and looking at some of the more really kind of progressive firms out there and what they were doing, I saw the kind of idea of doing this in a virtual mindset.

So you know, all of our team is remote. They’re all spread across the country. Same thing with our clients. So we have clients here in the greater Chicagoland area, but we have a lot of clients that are across the country too. And so being able to kind of leverage technology to serve our clients, you know, wherever they’re at, using kind of cloud-based tools to be more real-time with them versus, you know,, looking backwards constantly, has allowed us to really kind of build a firm that kind of serves the right type of clients and have the right type of people on board.

[bctt tweet=”All of our team is remote. Same thing with our clients. We have clients here in the greater Chicagoland area, but we have a lot of clients that are across the country too.” username=”TriMerit”]

You know, we still kind of maintain ties to Chicago, you know, while a virtual firm, you know, really doesn’t have a location, you know, I’m based in Chicago. And so, you know, we kind of maintain ties that location, and in serving clients, you know, there, but also across the country.

Well, that brings a couple things to mind for me, but first off, from an employee standpoint, do you find it—well, how many employees do you have at this point?

So we have a total of fourteen people in our firm right now. And so they, again—all remote and it’s been pretty, I wouldn’t say easy to get people on board, but it’s, you know, being virtual and having a remote team has definitely allowed us to kind of expand the type of people we try to hire and get the really the right people we want on board.

Yeah, I would think so. I mean, the biggest, you know, I’m fortunate I get to talk to a lot of CPAs around the country, and I go to a lot of conferences, and the biggest topic at every conference—or one of the biggest topics—is being able to, to attract and keep good people within public accounting. And so do you feel this virtual office—does the virtual office also mean, you know, flexible time to let people work at, you know, three in the morning, if they want that? I mean, you’re not requiring people to be sitting at their computer with their video conferencing on from 9am to 5pm, I’m assuming?

[bctt tweet=”This kind of virtual model allows us to really have good parameters that have remote work working really well. ” username=”TriMerit”]

Yeah, that’s correct, yeah. So people can kind of work when they want to work. We basically kind of establish you know, deadlines of when things need to be done, and when things need to get out to clients, but people can work, you know, whatever works best for them. So we have a lot of people who have, you know, kids in school, and so they’ll work during, while their kids are in school, and maybe work some at night, or on the weekends, or whatever kind of fits best in their calendar.

But it’s really allowed us to attract really good people as a result of that, because we’re offering something that most accounting firms don’t offer, or don’t offer well, you know. My old, when I was in public accounting, my firm I was at, they started like, kind of flex time work arrangement type deal. Well, when it actually kind of played out in practice, those employees are kind of treated as second class citizens, and you know, the kind of bounds or boundaries there always got broken, and so it didn’t work well. So having, you know, being this kind of virtual model allows us to really have kind of a good parameters that have remote work working really well. 

And like I said, it gets us really good talent. Like this last time we had a hiring round, which was this past summer, we were getting people coming to us, and we didn’t want to go fish for people. We had people who heard about us, or knew of us, and as soon as we had a job posting out there, we had all these applications come streaming in from really qualified and talented people. So it’s made hiring really—like I said, not easy, but it’s made hiring—puts us in a better position to hire than most traditional firms. And we’re able to kind of build roles and responsibilities around, you know, the right kind of skill sets that we need for our company as a result.

That’s great. And then from the client standpoint, you know, you’ve got this virtual practice, how is that interaction? Do you have face-to-face meetings still? Is everybody getting you everything electronically? Do you get on video calls? How is the interaction with your clients, when you’re, when you’re all remote around the country?

We do a lot of video calls—that’s kind of our primary method of communication—which is great for people who are not in the greater Chicagoland area, for myself to get in contact with them. We’ll still meet with people in person, particularly with one of the niche industries we serve, it’s very beneficial to meet in person. And so we’ll still do that, and I’ve gotten even out and flown out to clients and in other parts of the country, just to meet with them and spend some time with them. But we try to do all of our communication and kind of work virtually, get all of our information from our clients virtually, which really allows us to kind of serve them when and where they’re at. And it results, I think, in a better client experience overall. It’s not just a “do some work and kind of wait and see” type of thing. But it’s a way we can really be collaborative, and really kind of work stronger with each other when we have this kind of dynamic set up.

Yeah, it’s nice because it’s not—you’re not waiting for, “Alright, we’re gonna meet together next week at 2pm at this place.” I mean, if you need to meet, and you’re doing it virtually, and you can get all get online immediately, it’s kind of nice to have that option. 

Yeah.

So I can see that. And I can see a lot more firms trying to do things like this—I think you’re ahead of the game a lot, and I think you’ve done a nice job in four and a half years building up to fourteen people now. And servicing you said companies around the country, right? Or even around the world? Or is it around the country that you’re—?

Yeah, we have clients globally too, which is kind of fun. And it’s exciting to, you know, interact with those clients, you know. We have some clients in Australia. And so, you know, we’ll do calls with them, and it’s five o’clock our time, and it’s the morning the next day for them. And we’re still working to get things done. So it’s kind of exciting to be able to work with people globally, and interact with them in that way.

That’s great. So I want to—I think we should veer into that, because you did mention it a couple minutes ago: the niche industries. So not only did you start and had this idea that you wanted to build this firm, you know, based on technology, and based on the virtual offices, but there was a couple of industries that you also were concentrating on from the start. And I don’t know if it was one from the start and you veered to another, but can you kind of explain those industries that you’re working with?

Yeah, so we, the first primary industry work we work with is craft breweries. And so that was one that we, that I honed in on from the start of the firm, working with craft breweries. I had, you know, I’ve been a home brewer, I had a friend who is a really serious home brewer and thinking about starting a brewery. So got a lot of expertise and kind of industry knowledge from that. And so we have that as kind of our first kind of core industry to work with.

And then, you know, a couple years back, we added on digital agencies as that second industry, and really started, from having those companies come to us—just to kind of where we brand ourselves and market ourselves and have our website set up, we were actually tracking digital agencies to us. And so we decided to kind of create that as a kind of second niche industry that we work and service.

So, you know, the vast, vast, vast majority of our clients are in one of those two buckets. And it’s a lot of fun working in those industries, because they’re both really creative people and both very passionate about what they do. And so it’s fun to be in those industries and be there, working with them and, and helping ultimately their companies.

So I think, being a niche accountant, or how would you define the niche, you’re in a niche CPA, a niche firm, a niche—? Is there a term you say for that?

Yeah, I’d say we, you know, we kind of call it niches. So we are a highly, highly niched firm, because we kind of focus on those two industries, and don’t focus on anyone else at all. So we’re not going to do dentists or doctors or restaurants or retail shops or things like that, because they’re not in our industry.

So I was, when I was in Public, and I was in Public for quite a while, you know—I was proud of the fact that I considered myself a generalist. And then when I got into—my partner and I started Tri-Merit, about 13 years ago—and we concentrate just on a few specific areas of the tax code—becoming a specialist or working in that niche industry, I didn’t realize how much more fun that was. And I’m assuming being able to concentrate on just one industry or two industries—you know, allowing you to dig deeper into that industry and be the expert and the person that someone’s gonna come to? I don’t know, I find that enjoyable. I’m assuming you do as well, right?

Yeah, I do. I think you get to learn and get really deep in those industries, and really learn more about them than you would if you’re just kind of a generalist, and kind of picking up one of those types of clients here and there. It allows us, I think, also to serve our clients much better, because we know their industry so well. We know all the things that are going well, that are not going well, and the kind of trends within the industry, we’re able to guide and lead our companies that we work with, much more better than if we were just kind of working with anyone that came to us. So it’s really allowed us to get really established, really deep in the industry, which allows us, I think, really to serve our clients at a much more fuller way as a result.

And I’m going to concentrate on craft beer for a minute, because that’s one of my passions is craft beer. And I think you and I offline, we’ve talked about this before—but I am part owner of a craft beer bar in Chicago, and so it is a little bit of a passion of mine. So I find that if I was back in Public, I would love to be in that niche. But being in that niche and knowing that you are, you know, the go-to guy, that you can dig deep, does that help?—obviously, from a marketing standpoint, you mentioned that—but are clients coming to you, are you having to work hard to  go out and get clients? And I’m sure you’re still working on it. But I’m guessing it helps bring clients to you directly just from them knowing that you’re the firm out there.

[bctt tweet=”You get to really learn more about {your niche industry} than you would if you’re just kind of a generalist. It allows us, I think, also to serve our clients much better, because we know their industry so well.” username=”TriMerit”]

It does, yeah, it definitely gives us a kind of established kind of, you know, expert leadership in that area. So it’s allowed us to really have, you know, like I said, have clients come to us, because they hear about us, they know about us, and they know that they want to work with someone who has that expertise. And so we get a lot of breweries who just come to us and say, “Hey, I know you work with these breweries, or I’ve heard you speak at these conferences and I’d love to have you come and talk and see if we can work together.”

And so that’s been really good. You know, we do a lot on the content marketing perspective too, to kind of keep reinforcing that out there, is through the blog posts that we put out there, social media that we do, as a way to say, “Yeah, we’re on top of the industry, we know what’s going on, and we can use that expertise to help, you know, make your brewery a better business overall, as a result.”

Yeah, I would think that social media, marketing, networking, blogging would be huge. Especially in that industry, it seems like every brewery out there is constantly on Instagram and everything else, just showing what they got. So if they see you out there, too, I’m sure that helps a lot.

It does. It does. It definitely, having that kind of presence there in social media has helped tremendously because, you know, there’s a number of clients that we’ve got in the brewery industry who saw us because we were posting on social media and interact with other breweries on social media. Like, “Why is this accounting firm interacting with breweries and what’s going on here?” And that’s, that’s opened the door. So that’s been cool to see.

Nice. It’s nice, I guess, education into marketing. And you don’t have to, I’m assuming spend tens of thousands of dollars to get out there and get your name out there. As long as you’re out there in a space where other people can see you, and they feel that you have a good message to tell, it can help a lot.

That’s exactly it, yeah.

So I want to go into one thing that I read recently about you, and I’ve been hearing this from more and more firms lately. And I think this may have been a decision you started when you started the firm. You can tell me. But did I see that you don’t track time—that your projects or your engagements are based on the value pricing?

That is correct. Yeah, that was one of the things from being in public accounting that I hated doing was tracking time. I felt like I was—it was the biggest waste of time, because a lot of engagements we worked on, they were fixed-fee price, so we’re gonna charge the same amount from that client, regardless of how many hours I put into that engagement. We spent so much time with focus and effort on how much time was put in each thing, and what, you know, I saw in the industry, was a lot of times that people are putting the time and they were just kind of fudging those numbers a bit, because they had a boss telling them like, “Well you can only charge five hours this job,” and so they charged five hours, you know, but it took them seven hours or ten hours.

And so we had all this bad data coming through, that we all knew was bad, and then we’re trying to judge and make estimates and management decisions based off it, which we knew were off of bad numbers. And so, I just, kind of that frustration with that, being in Public, and so when I started my firm I was like “We’re not going to track time and jobs, we’re going to value price,” because I think that’s a better way to go about doing it.

I think it creates a better collaborative relationship with our clients. So clients aren’t afraid to call us on the phone or shoot us an email and ask questions, because that’s kind of part of their engagement, and they’re not going to get billed by the hour for that phone call. We’ve had a number of clients come to us who were frustrated by that with their prior accountants, where they felt like they couldn’t ask any questions, and so they didn’t, or they kind of asked them all at  once, and it was kind of after the fact, and that didn’t work as well.

So that’s really worked well for us. And I think it also helps kind of define the scope and what the value is to the client, and what problems we’re actually trying to solve for the client, that I think as you go through the sales process in more of a value-based mindset, you start to hit on, really, what they care about and what they don’t care about. And so if they really don’t care about some fancy charts and graphs, let’s not make them fancy charts and graphs. Let’s do what they care about what makes the most sense, that allows us ultimately to better serve our clients as a result.

Yeah, I first heard about this phenomenon, in my mind, probably 10 years ago: a pretty decent-sized firm that I was friends with, they had a timecard burning party. And I haven’t really kept up with them to see how that went, but at the time I was like “Wow, this is cutting edge stuff.” I don’t know if it was but in my mind, it was. But I was all for it, because time tracking was my least favorite thing in public accounting, and I agree, and I’ve learned that too.

But I hear that all the time from people now that that’s really the way every firm should be going. And I agree with it. I don’t know if they are, but I think again, another year on the cutting edge of all these things. I’m really interested to see where this takes you. Are you, I’m assuming your goal is continued growth. Are you seeing where it takes you? Do you have goals where you want this firm to be? I mean, do you have an idea what you’ll be doing in five years, ten years? Or plans?

Yeah, we’ve spent a good amount of time kind of focusing on kind of what our growth strategy is, and kind of meeting those kind of targets. So we’ve been on these kind of three year kind of iterations of what the strategic plan is, and kind of where we want to be next year. What kind of growth do we want, what’s too much growth, what’s not enough growth, and that’s really been helpful and kind of shaped where we want to go, and knowing when we have to put down the pedal on the accelerator, when we need to step off it.

Like right now we’re in a period of time where we’ve stepped off the accelerator, because we kind of met our growth goals and targets and growing more would be, I think, painful for everyone involved. And so we’ve taken the foot off the gas. We’ll, you know, put that foot back on the gas next year and kind of hit more targets that we want to hit. So our goal is to kind of continue to grow this firm, grow it in a way that’s healthy and sustainable. And is allows our employees to kind of be proud of the work they’re doing, and excited to be along for the ride. And so that is kind of what our kind of goal plan here is the next few years.

Well, I was gonna ask you about the CPA Practice Advisor, three years in a row on 40 Under 40. I mean, that seems like an accomplishment. Is that unprecedented? Has that happened before. Do you have any idea on that?

I’m not sure. I wouldn’t be surprised if it’s happened before I keep making the comment that I must be aging out of that pool yet, and I’m not.

I was gonna ask the same question. How many years can you still qualify?

I’m 36. So I still have a couple years left of qualification there, so

All right, I think we need to put a big push on. Let’s see if we can get like seven, eight—can we make eight?—seven years in a row at least. And then set the all time record and no one will be able to beat it.

Yeah, there we go.

But I can see, so the point is, I can see why now, with all these innovative things that you’re working on: the virtual office, the niche practice—which I am a big fan of—as well as the value billing, the value pricing, all of that, I’m a big fan of, so I can see why they are impressed with you.

And I won’t ask you if they know if there’s anybody else under 40 they can be talking to because obviously there is, and there’s a reason that they talk to you. So that’s awesome. But what I’d like to do, and we’re about time to, I think, start wrapping things up, anything you wanted to add, that we didn’t talk about so far?

You know, I think, you know, one of the things that we’re really passionate about in our firm, is really kind of our core values, and leading and living into the core values and culture that we have. Because we’re remote, and because we have our team kind of spread across the country, it’s not as easy to build a culture, but I think it’s just as important, if not more important.

Having people across the country and working remote, you know, you can kind of feel on an island, if you don’t have people to interact with. So we’ve built in things to allow our team to really kind of work and in lean in with a culture that allows us to do some kind of fun things together. So we do things like bring everyone together in Chicago a couple times a year for a company retreat, we do things like virtual happy hours, where we turn on our cameras at a time, and we’re not here to talk about work, we’re here to talk to each other and have fun, we’ll do weekly kind of team meetings, just checking on everyone and how everyone’s doing.

But really kind of building that culture part is important, because we could have a bunch of great remote workers, but if they feel isolated, they’re not gonna stick around. And that, you know, having a good culture makes you know, people sticky and stick around for a long time. So by and large, our employee base, you know, we hire them and they don’t leave. And so that’s good. We’re excited to kind of continue to build our firm, to have people here who want to be here and excited to be here and buy into the culture that we’re trying to create and establish.

That’s a really good point, and I’m glad you brought that up. Because that’s something that I think is very important—especially with, you know, individuals working at home by themselves, we have that same situation where we have a handful of people in a couple offices, but then we have a lot of people that work remotely around the country. And we do the same thing you do: get together a couple times a year. In fact, we’re getting together in Orlando in about six or seven weeks, and that type of thing I think is important to get everybody together.

How about professional growth, personal growth type stuff with your employees? Is there education classes that they’re able to take or that you concentrate on, or anything that way?

Yeah, I mean, we, you know, being virtual remote, we kind of rely on a lot of kind of virtual webinars and things like that, because I think that works well. But when we come together with the retreat, we do a live in-person training too. Spend some time it’s like, let’s talk about some areas where we can all grow together. And that’s good.

And then we also do, we’ll go to conferences and things like that together, and be there in-person for those. They’re kind of a fun time to interact with each other and spend some time learning together and talking and processing. Because, you know, I think everyone’s got really great perspectives that they come from, and having those kinds of diverse views and voices together allows us to build a better company as a result. And so that’s kind of really exciting for us to be able to kind of do those things together and learn from each other.

I know you were at a conference last week, did anybody else from the firm go out there with you?

For that conference, it was just me. We had a conference a week before that, where I had six of our team members together on that, which was a lot of fun. So it’s fun to kind of get them together and learn different things, or even just hear a perspective on things that I may not pick up, but they did, and it allows us kind of a different vantage point on how we can be a better company as a result.

All right, well, so I did say I was gonna wrap it up before, but that was a great segue we went into there, so I appreciate that.

What I would like to do is kind of wrap it up now. And what I would like to ask you, it’s more of a fun question. And because of your niche industry, I thought I’d ask if you, if tied in with that craft brewery industry, do you have a favorite—and I guess I won’t ask brewery unless you want to say your favorite brewery—favorite beer style, anything in that way that you’d like to expand o?

Yeah! I like, you know, having been a part of this for a while, you know, you kind of see different fads or different kind of, you know, things kind of come and go. One of the things I really have enjoyed recently are more kind of traditional English-style beers. So yeah, ESBs, and some kind of, you know, mild ales and cask ales, and things like that. So those are kind of, I think, on my favorite list right now as well as because now we’re entering into some of the cooler months, you know, the porters and stouts and kind of those heavier beers, those are fun to drink in the winter. So I think those are kind of my styles I’m leaning towards right now.

I’m kind of a little bit kind of a little bit over IPAs right now. So I get these kind of seasons where I’m like, I can’t do an IPA for a while. But right now, it’s kind of a traditional English-style ales are kind of my go-tos right now.

I agree with you completely. I’m the same way with that. I was fortunate I was in London a few weeks ago and got to try some nice ESBs and bitters on cask and enjoying that London beer was a lot of fun. But same thing with IPAs like you said, I go up and down with them for a while and then it’s time to turn it off. But I am looking forward to some nice stouts coming up.

To that end, Any chance you’re going to the festival of that barrel aged beer that’s in Chicago this weekend?

I may find myself there on Saturday, yeah, I’m hoping to be there.

Well if you do, have a great time. I have not been to that one. I’ve heard it’s an awesome event.

It is a great event. Lots of incredible beers and breweries there and so it’s always a fun one to go to.

Alright, before we wrap it up. How can people get ahold of you or get in touch with you or see you online? What’s the best way?

Yeah, so you can get me on Twitter at @LanceJD1 or on Instagram @JoshuaLance82. Or you can email me at Josh@LanceCPA.com.

All right. Well, again, I really appreciate you being on the show—you know from that cold call you got from me to join in. I had a great time today in the conversation.

Great, thanks. I’m glad to be here and it’s fun talking.