CPA firms: Create a niche practice serving the emerging gig economy

In today’s workplace, people are forging careers as drivers, photographers, writers, graphic designers, marketers, and other types of service providers. These and other types of independent contractors are finding themselves among approximately 55 million freelancers in the United States, and that number is growing. Entrepreneurial workers are moving away from full-time jobs in favor of more freedom and control over their livelihoods. They are buying into a business model where they structure their work on individual assignments, or gigs.

This gig economy is creating a market ripe for building a niche practice, and Jody Padar, CPA, principal and CEO of New Vision CPA Group, is seizing the opportunity to do just that.

“There are tax laws that apply to the gig economy, and we found if we can segment the base model and standardize our price and practice around that, we can create efficiencies,” Padar, a speaker at the AICPA ENGAGE conference on Wednesday, said during a preconference telephone interview.

Founded by Padar’s father, James Matousek, CPA, New Vision Group of Chicago has developed a cloud-based system that takes a systematic approach to creating business solutions for freelancers and small business owners. Think “small business solution in a box,” Padar said.

Using online accounting products such as QuickBooks Online, Xero Accounting Software, FreshBooks, Practice Ignition, and others, the firm can work with clients from across the country in a virtual office space.

New Vision CPA group counts among its client base about 30 freelancers as well as a number of small businesses. The firm also has a package for commercial real estate agents.

“What we have created is a business support system,” Padar said. “Our freelance clients do their jobs very well, but sometimes the administrative chores can become overwhelming. We become their back office, help them run their business and do it right.”

Fees start at $500 a month, a price Padar’s clients are willing to pay to avoid the sometimes-complicated details of running a business.

“Our clients love it,” Padar said. “We bring value to their business, and we have found we can give them peace of mind.”

For Padar, peace of mind goes both ways. “By virtually joining our creative clients’ teams, we help them with bookkeeping, contractor payments, payroll, etc. on our system,” she said. “We are in live files all year because of the cloud. We are an extension of their administrative team. Think outsourced controllership on a micro level. We can also help with regular business-kinds of problems and provide advisory services, too.”

Padar has realized she can take some of the grunt work out of the busy tax season and spread it across the entire year, making for smoother sailing at tax time.

“We make their lives and our lives a lot easier, and it’s a win-win for both of us,” she said.

The firm performs routine accounting; does payroll and annual tax filings; and can assist with business plans, incorporation, and estimating quarterly taxes. CPAs stay in touch with freelancers through routine phone calls, and they are available to answer questions at any time.

She estimates just 5% of CPA firms are serving the gig economy in this way.

Padar offers a few tips for establishing a successful niche practice serving the emerging gig economy by segmenting this particular client base, creating a standard service structure, and building a practice around it:

Create a standard process and establish tools for your freelance clients to use. Freelancers may work in a variety of disciplines, but they all have similar accounting and business management needs. Padar’s toolkit is scalable to almost any small business or sole proprietor. “We give freelancers a technology stack to use. They adjust their processes to our format and use our tools,” she said. “It’s turnkey. They follow our system, and they adapt to our accounting practices. That efficiency is key to our ability to offer this service.”

Take advantage of the cloud. Cloud technology has come a long way. It’s secure, convenient, and allows CPA firms to expand their client base beyond geographic boundaries, according to Padar. “We email our proposals and engagement letters,” she said. “During our onboarding process, we connect our client’s bank account to digital products, and we hold a virtual meeting to get started. We touch base by phone or Skype quarterly to check in and make sure everything is going smoothly.”

Word of mouth is a good way to grow this client niche. Padar is focused on growing her creative clients organically and has acquired most of them through recommendations. “We get a ton of referrals,” she said. “Creatives are well-connected, and word spreads like wildfire among their contacts. The message we’re getting back is the gig economy is here to stay.”

—Teri Saylor is a freelance writer in Raleigh, N.C. To comment on this article or to suggest an idea for another article, contact Ken Tysiac, editorial director, at Kenneth.Tysiac@aicpa-cima.com or 919-402-2112.