651 This 2 Person Accounting Firm Does $1.6M/Year [How today’s most scalable firms are built]

Jason Staats of Accounting Firm Coach reviews how ultra-lean accounting firms are scaling through outsourcing, offshoring, and automation, using two sale listings to show what the economics look like. He also covers IRS guidance on AI use, explains why consumer AI tools create compliance risk, and argues that firm leaders need clear governance and a business-grade AI stack.

Key points

• A two-person virtual firm is reportedly doing about $1.6M in revenue, with the margin gap largely explained by outsourcing costs.
• Staats argues outsourcing is a black-box service model; offshoring is closer to managing your own remote team.
• IRS tax-attorney guidance says prompts and uploads to consumer AI can create disclosure/training risks for tax return data.
• He says firms should give staff approved business AI tools to avoid shadow IT use of consumer ChatGPT/Claude plans.
• Grok is treated as useful for personal tasks, but not yet the best business AI for accounting work.
• For firm acquisitions, he says seller-financing with clawbacks is common and preferable to fully cash-upfront deals when possible.