Divided Opinions Persist for Private Equity in Mid-Tier Accounting

Private equity in Mid-Tier accounting has become a defining and divisive feature of the industry’s evolution. While some firms see it as a launchpad for growth, others fear cultural erosion and loss of autonomy. One thing is clear: its influence is growing—and fast.

The Rising Tide of Private Equity

Over the past 18 months, private equity interest in UK accounting firms—especially mid-tier practices—has surged. According to a new report from the Institute of Chartered Accountants in England and Wales (ICAEW), this trend shows no signs of slowing.

The report, “Evolution of Mid-Tier Accountancy Firms,” explores key industry themes: growth, structure, talent, tech adoption, and service diversification. A striking takeaway? Private equity investment was ranked a top-three driver of change by 86% of respondents, up from 57% the previous year.

• 81% placed it in their top two

• 64% ranked it as the single most important change factor

These figures demonstrate how firmly private equity has planted its flag in the sector.

First-Timers vs. Repeat Investors

Yet despite this rise in influence, mid-tier firms remain split in their attitude toward private equity.

Among firms without any current PE backing:

• 55% said they did not find the idea of taking on private equity attractive

• Only 7% found it very attractive

Among firms already backed by private equity:

• 22% said further investment was not attractive at all

• Only 11% were very positive about the idea

Hesitations largely stem from concerns about:

• Cultural disruption

• Loss of autonomy

• Perceived “faceless” ownership

• Risks to talent retention

These are not unfounded, but how much of this is perception vs. reality?

A Different View from Inside

Interestingly, firms already in partnership with private equity provide a more optimistic picture.

• 78% of PE-backed firms said talent retention had not been an issue

• None reported significant cultural integration problems

The only notable downside? Increased reporting and investor scrutiny—a challenge for time-poor leadership teams already juggling recruitment, AI integration, and economic uncertainty.

Still, for some firms, this level of accountability is viewed as a positive driver of better governance and sharper focus.

What’s Driving Private Equity Interest?

Sarah Ghaffari, ICAEW’s Director of Communities, Business and Practice, noted that private equity’s appetite for accountancy remains high. With deal volumes strong and media attention sustained, the sector is seen as:

• Predictable and resilient

• Undergoing tech-led transformation

• Ripe for consolidation and scalable value creation

This has led to divergent strategies across the mid-tier. Some firms are actively embracing private equity to fund bold growth plans, while others remain committed to independent and organic development.

A Strong Year for Mid-Tier Firms

The ICAEW report also paints a positive picture of performance:

• Every firm surveyed reported fee growth in 2024/25

• Growth was driven by new client acquisition and increased client spend

• M&A activity, particularly among PE-backed firms, also contributed

However, the skills gap continues to challenge the sector. Over half of the firms identified talent access as the biggest barrier to continued growth.

Despite this, Iain Wright, Chief Policy & Communications Officer at ICAEW, believes mid-tier firms are well placed to support UK economic growth. Their ability to provide tailored insight, assurance, and risk management makes them invaluable partners to businesses navigating change.

Conclusion Private Equity in Mid-Tier Accounting

Private equity in mid-tier accounting is a subject that continues to polarise. For some, it’s a clear enabler of strategic growth and innovation. For others, the cultural trade-offs feel too steep.

But whatever side of the debate you fall on, the data is clear: private equity’s influence is increasing, and it’s reshaping the future of accountancy in the UK.

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