Grassi: How the Hell Did This Happen? | Gear Up For Growth

Here’s what it takes to grow a CPA firm from zero to the Top 100—without losing your soul.

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In this conversation, Grassi reflects on what it takes to build a firm that grows sustainably, treats people like owners, and stays independent in a profession reshaped by private equity, talent shortages, and rapid change.

Grassi’s early growth story sounds almost impossible by today’s standards. After leaving a Big Four firm because he craved deeper client relationships, he decided to “build a better mousetrap.” Armed with industry experience, confidence in his client service skills, and a willingness to take risks, he sent 2,000 pieces of direct mail–by hand.

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Seventeen interviews followed. Ten became clients. Within six months, the firm had a $275,000 revenue runway.

But the real inflection point came when Grassi made a choice many founders struggle with: reinvest instead of cashing out.

Rather than enjoy the early financial upside, he hired top talent, drained his savings, and committed to constant reinvestment in people and infrastructure. “If you don’t invest for growth, you don’t have growth,” he says. “If you don’t invest in people, you don’t have people.”

That mindset—reinvesting early and often—became a cornerstone of the firm’s long-term success.

Why Niche Strategy Isn’t Optional
Long before “niche marketing” became a buzzword, Grassi was building a niche-based firm—and defending that choice to skeptical peers.

His view is blunt: generalism limits growth. Without deep industry focus, firms struggle to develop meaningful service offerings, retain clients, and compete effectively.

At Grassi, niche leaders are required to build business plans and present them annually. Consulting teams work exclusively within specific industries. Service offerings are designed around what clients actually need—not just compliance work they tolerate.

“We’re one of the only professions where most of our revenue comes from things people need but don’t necessarily want,” Grassi says. “If you don’t have a playbook for what they really need, they won’t stay.”

The firm tracks how many services each client receives and intentionally builds cross-functional teams to deepen relationships. No client is ever seen through a single lens—and no partner operates in isolation.

Culture Is Built Through Inclusion, Not Control
Grassi’s leadership philosophy is grounded in one core belief: people need to know you care.

That belief shows up in tangible ways. The firm’s Net Promoter Score is nearly double the accounting industry average. Its employee turnover is now in the single digits. And Grassi is consistently recognized as a best place to work.

The secret isn’t perfection—it’s participation.

Grassi emphasizes mentorship, transparency, and inclusion across generations. Rather than dismiss younger professionals as “unwilling to work,” he argues leaders must adapt to how people think, communicate, and find purpose.

“If people understand why they’re doing something and feel like they’re contributing to a common goal,” he says, “they’ll work as hard as you want them to.”

From open idea-sharing platforms to regular “Seinfeld breakfasts” with staff—informal conversations with one rule: bring a solution, not just a complaint—Grassi has built systems that invite feedback and reward initiative.

Just as importantly, leadership communicates openly about the firm’s strategy. After partner retreats, Grassi visits every office to explain goals, growth plans, and priorities so no one is left wondering what’s happening.

Choosing ESOP Over Private Equity
In 2023, Grassi made one of the most consequential decisions of his career: implementing an employee stock ownership plan (ESOP).

At the time, the firm was being courted aggressively by private equity and larger platforms. But Grassi was unconvinced the PE model aligned with the firm’s values—or its clients.

“Our clients are our friends,” he says. “I couldn’t let them down.”

Inspired by firsthand experience helping a longtime client build life-changing wealth through an ESOP, Grassi chose a different path. The process was complex—especially under New York’s ownership rules—but the impact was immediate.

Employees began receiving ownership statements. Retention improved dramatically. And the message to the market was clear: Grassi would remain independent, permanently.

“There’s no more ‘us versus them,’” Grassi tells his team. “We’re all owners now.”

Advice for Firms Under 100 People
For smaller firms looking to grow, Grassi’s advice is direct: hope is not a strategy.

Firms need a real plan, alignment among partners, and a commitment to growth—not just staffing. They must work on the firm, not just in it, and be willing to learn from others doing it well.

“Act today like the firm you want to become,” Grassi says. Study successful firms at your target size. Borrow what works. Build cross-functional teams. And make growth everyone’s responsibility—no exemptions.

Humility, he adds, is non-negotiable. “If you think you have all the answers, you won’t grow.”

A Legacy of Care
When asked what he hopes Grassi will be known for 20 years from now, Grassi doesn’t hesitate.

“That we cared—about our clients, our people, our profession, and our communities.”

It’s a simple answer. And after listening to his story, it’s clear that simplicity—paired with discipline, reinvestment, and relentless curiosity—is precisely what builds a lasting firm.

Other highlights include:

• Grassi rejected private equity offers to protect clients and firm independence. 
• Grassi’s ESOP strengthens recruiting, retention, and succession planning. 
• Grassi relied early on direct mail marketing – 2,000 pieces leading to 17 meetings and 10 clients – and reinvested every dollar into talent and infrastructure. 
• Early challenges due to his youth led to creative solutions, e.g., adding gray color to his hair to win a hesitant prospect. 
• Grassi tackled tough tax cases to win major clients, proving value through problem-solving. 
• He ensures no one says, “I don’t know what’s going on at my firm.” 

More About Lou Grassi, CPA, CFE
Louis Grassi, CPA, CFE, is the CEO, founder, and managing partner of Grassi, a top 100 firm in the United States. Since founding the firm at the age of 24, Grassi has led his firm through 45 years of industry change into a top 100 firm in the U.S. Grassi has been nationally recognized as a Best-in-State CPA and among the Top 200 CPAs in the nation by Forbes, as well as a Managing Partner Elite by Accounting Today and a Most Admired Peer by INSIDE Public Accounting.  

Transcript
(Produced by automation. Not edited for spelling or grammar.)

Jean: Hello, thank you for joining Gear Up for Growth powered by CPA Trendlines. I’m Jean Caragher, President of Capstone Marketing and your host. Today’s guest is Lou Grassi, CEO, founder and managing partner of Grassi, the 56th largest accounting firm in the United States. Both Lou and the firm have been recognized many times regarding client service, leadership and firm culture, too numerous to list here, but I have questions about it all. So Lou, welcome to Gear Up for Growth. 

Lou: Thank you very much. I really appreciate you having me on today. 

Jean: Right. Well, we go back a long way and we’re going to cover a little bit of that, but I’d like to start off first with Accounting Today’s Top 100 firms list in 2025. As I just mentioned, Grassi was number 56 generating $146.5 million in revenue, seven offices, 58 partners, 561 employees. Could you have imagined all this back in 1980 when you started the firm? 

Lou: I could have never imagined. I couldn’t even imagine at that point in time how I was going to afford me because I couldn’t afford me because I started the firm at zero. I was 24 years old and obviously, so I could have never imagined where I am. I still pinch myself occasionally and say that I can’t imagine, but when you’re in it and every day becomes the next day and you’re obviously working on your strategic plan and looking at your growth goals and making sure that everyone in the firm is truly aligned, etc., etc., you just don’t usually take breaks and realize how much you’ve accomplished. But occasionally, I just take a deep breath and say, “how the hell did this all happen?” 

Jean: So, Lou, you just mentioned that you started Grassi when you were 24 years old. What gave you the confidence to start your own firm and what were some of the important decisions you made that helped the firm grow? 

Lou: Well, I mean, one can say it’s naivety, clearly, but I had worked for a Big Four firm and even though I had a very successful tenure there, I just never felt connected to clients and I needed connectivity in my life. And when I left the firm, they asked me, “What are you going to do?” And I said, “I don’t know. I’m trying to figure it out.” And when I tried to figure it out, I said, “I’m 24 years old. I’ve been preparing income tax returns since I’ve been in high school.” I worked 30 hours every week for a small accounting firm when I was in college. And then, you know, a few years at KPMG and I just said, “You know what? Let me try this. This is probably the only time in life where I may be able to try it because I don’t have any responsibilities. And if it doesn’t work, they don’t take my CPA license away from me. I think I could build a better mouse trap. I think client service clearly is something I excel at and I really think I should give this a shot.” And that’s why I did it. And it took a while, but I did have a plan. 

And in 1979, there was a case in Florida that allowed CPAs to advertise. So what I did is I went out and bought a list in industries that I had a lot of experience in. And in those days, you know, you were putting labels on envelopes. There wasn’t any emails. So I went out, hired a marketing firm and put together a letter and free consultation, etc., etc., and sent out 2,000 pieces. You know, I licked every envelope and I put every label on there that I had bought from this marketing company. And I said a prayer. And the next thing I know, I had about 17 interviews on 2,000 pieces of mail. Some people I just couldn’t get in touch with because even though they did reply, but I had 17 interviews. And the next thing I know is out of those 17 interviews, I had 10 new clients. And all of a sudden I went from a zero base to about a $275,000 runway within six months of me starting. 

So I decided that, “Oh, wow, now I can probably, you know, make some money.” Well, the next thing I did is I said, “I’ve got to go out and get the best person I’ve met in the profession.” And he was a really sophisticated tax guy. And I went backwards and went back to making no money. I had saved up about $25,000. And I said, “I can either invest this in the stock market or I can invest it in Lou Grassi and I’m choosing Lou Grassi.” So I went out and got a really, really talented guy that would work alongside me and just kept doing the same play. And I would say by the time I was 30 years old, I probably had about 12 CPAs working for me. But I did something that a lot of CPAs and a lot of people that are in small firms never do. I constantly reinvested in the firm. And that’s the way it happened. Because if you don’t invest for growth, you don’t have growth. And if you don’t invest in your firm, you don’t have a firm. And if you don’t invest in people, then you don’t have people. So the idea is, you know, you’re always investing. And that was my philosophy. I always wanted to continue to invest because I knew that I always wanted to continue to grow the firm. 

Jean: I mean, that’s quite a story, right? Because that was direct mail to cold people that you don’t know. And it gave you success. So, you know, so for those watching and listening… 

Lou: So here’s the deal. I have to tell this part of the story because I think it’s really funny. So the first client I tried to get, at 24 years old, was a business person that I knew locally. And he basically said, you know, “When you graduate college, come to see me.” I said, “No, no, no, I’m the CPA. And I just started my own firm.” And he’s like, “You’re too young. And you know what? When you have gray hair, you come back and see me.” So I had a mentor at the time, and I’m telling him the story. And he says to me, “You know, I think I could solve your problem.” And I said, “How’s that?” He said, “Well, my wife owns a hair salon. And I’ll just have her spray gray in your hair. And we’ll solve that problem.” And we did. And I called him back. And I said to him, “You know, I want to come back and see you.” And he said, “What are you talking about?” I said, “No, no, no, you have to see me. Could you just give me five minutes?” I said, “You told me to come back when I had gray in my hair. I have gray in my hair. I’d like now to take over your business.” And he turned to me, and I’ll never forget this. And he turned to me and he said, “Anybody who wants my business and could be that clever in doing this, you got my business.” And that was my first major account. 

And a few others were similar stories. One person came back to me and he said, “I have this huge tax problem. If you could solve it, you got my business.” And I’m like, “I’m going to take you on your word.” And listen, at that time, I had nothing else to do. So I said, “Oh, let me see if I can fit this in my schedule.” I looked at my schedule, obviously. And I didn’t have anything in it. So I had plenty of time to do it, figured out a way to win the tax case. And, you know, so it was really, really great stories. I’m reliving it, which I rarely do, as I’m speaking to you now. And it was really an exciting time and building something is really exciting and continuing to build something is very exciting. And, you know, achieving milestones in your business is just the best thing that can happen to anyone. And I’ve been truly blessed with a lot of amazing awards over the years. And I’m just a very blessed human being. 

Jean: Right. Those are great stories. So Lou and I have known each other since the late 1980s. Okay, so benefit of those watching and listening. When you were growing Grassi and I was the marketing director at Israeloff Trattner. So I remember some competition back then. So that’s a blast from the past, right? 

Lou: Certainly was. 

Jean: What is the biggest change in how CPA firms can promote and grow their firms now compared to back then? 

Lou: Well, I think the model is still the same. Obviously, the way to get there, just like, you know, marketing is still the same in many ways, but it’s radically different. In other words, what I did with direct mail, you know, you use a different medium today. Obviously, you’re using emails, etc., but conceptually, you know, making yourself available to the market. I have a saying that either you’re a student of the marketplace or you’re a victim of the marketplace. And I’ve been saying that for years because you need to really understand, if you’re going to grow a CPA firm and you’re going to be the person in charge of that growth, whether you’re a niche leader within a firm, a service line leader, etc., if you’re in charge of something, you need to be a student of the marketplace and you need to know what’s going on in the marketplace. And then what you have to do is try to outsmart your competition, which I’ve been doing for years. That’s the way to do this. That’s the way to play this game is you study the marketplace, and you know everything about the marketplace and you figure out what’s exactly what’s going on in the marketplace. And that’s the only way to really succeed, is to really know how to develop a playbook on how you’re going to succeed in that market. 

And we do it today. I mean, every one of our niche leaders writes a business plan and presents it at our annual partner retreat. We’ve always been a niche-based firm. We will always be a niche-based firm because it works. If you have one or two of something… I remember being at a managing partners meeting and I was probably all of 31, 32 years old. You remember the managing partner meetings on Long Island. And I went into the meeting and someone said, you know, “Introduce yourself.” And, you know, I was, like, so honored just to be in the room. And he turned to me and I told them that we were a niche-based firm and blah, blah, blah. He’s like, “Young man, you know what? You should have learned something a long time ago. You don’t put all your eggs in one basket.” He’s like, “You have to be a generalist like me.” And I said, “I don’t know how you can survive being a generalist.” And he’s like, “You’ll see.” Well, obviously he went out of business and I think we’re doing pretty well. So I think, you know, being a niche-based firm has never kind of literally led me in the wrong direction. And I firmly believe that. In order for you to really put together a playbook in industries, etc., you really, really need to know what’s going on in that industry. And you need to, like I said, develop, you know, service offerings around what people need. I mean, you know, we’re the only profession that most of our revenue comes from, you know, something that people need but don’t necessarily want, you know, financial statements and tax returns. So if you don’t have a playbook of stuff that they really need, they’re not going to stay around long, clients. 

That’s what you need to make sure is that how do you stay in the game? How do you grow your relationships? You know, I read a long time ago that if you’re offering one service, you have a very low percentage of keeping a client, two services, a little greater. But, you know, once you go three and beyond, then obviously you have a very high probability of keeping that client. So, you know, we keep track of that at Grassi. You know, how many relationships are we where we’re only offering two services and then obviously have a playbook as to, you know, depending on the niche, what service offerings are we going to offer these clients because it’s based upon what they need. And if you don’t have a playbook on what the clients’ needs are, then you don’t really know enough about their business and you shouldn’t really be servicing that client [inaudible 00:13:21]. 

Jean: Right. One of my questions was about niche marketing because you were a fan of niche marketing before it was a thing. 

Lou: Yes. 

Jean: And I think we would agree that there are many, many firms now that do go to market by industry niche or service niche, but there are still plenty that don’t. And it boggles my mind of how they can’t make that switch. 

Lou: I don’t understand that. I never understood it. Like I said, even when I was chastised for espousing it at a very young age and someone was going to tell me, you know, what I didn’t know. But, you know, it’s really the only way to go. You need specialized services, you need industry exposure and, you know, that’s really the only way to go. I mean, if you have one and two of something, what are you going to do to offer additional services? I mean, we’ve even gone so far as that within our niche groups, our consulting people only work in that niche because I want our consulting people to be obviously everywhere in that niche and developing solutions, not just across, you know, eight different industry groups, but really one industry group. That’s it. Focus in on that one industry group, find out what that industry groups needs, and obviously let’s build service offerings that are attached to that industry group. 

Jean: Right. Right. Okay. So I’m going to switch the conversation a little bit. Grassi has been recognized as a best place to work. Your net promoter score is 78.7, which is huge. That’s twice in the accounting profession, right? 

Lou: Over double the industry. Correct. 

Jean: Right. What cultural practices or leadership habits do you think contributed most to building Grassi as a best place to work? And what could smaller firms learn from your experience? 

Lou: Okay. Well, obviously people need to know you care. That’s a fundamental thing. People need to know you care. And the other thing in order for you to be recognized as your employees and for them to vote for you, as you know, a place that they love coming to each and every day, is you really need to mentor them. You really need to guide them and you need to be inclusive. You know, I often get into discussions because I’ve led a number of managing partner groups over the years and people just say, “Well, you know, this generation just doesn’t want to work.” And I said, “Well, this generation, unlike our generation, you didn’t just tell them what to do. And, you know, we just said, ‘Okay, fine.’ And you waited for the boss to leave and then you decided to go home. That’s not this generation.” You know, they have four yoga classes before I leave the office after hours. 

But if you include them in projects and they understand…they have to understand. There has to be a reason. And if you include them as a member of a team and you work towards a common goal, whatever that is, if you’re on an audit and, you know, you’re going to obviously get it done on time, on budget, and, you know, then you’re going to have enough takeaways so that we can talk to the clients about additional service offerings at the end, and they really feel that they’re a contributing part of that, they’ll work as hard as you want them to. You just have to learn how people think and every generation thinks differently. 

You know, our generation just said yes to everything because we were too afraid to say no. But that doesn’t make it right. But if you include people and they have a purpose and they have a meaning and they feel like they’re a really, truly contributing member of the team, then you’ll get them to… And I think that’s why, you know, in every one of our offices, we’ve always been ranked, you know, locally best place to work because, you know, it’s our culture. And we’re not perfect. And I’m not going to say we’re perfect. But we try really, really hard to be the best we can be. And it’s obviously reflected, you know. 

We do the same thing with client service. I mean, you don’t get consistently year after year, you know, ranked highest in the country unless you really put a lot of time and effort in it. The problem with most CPA firms is I call them Greece. They’re just islands in the sea and everyone kind of does their own thing. That’s just not the way we run our firm. You know, we’re connected. Everyone’s connected. You know, we’re either connected through our niche groups, we’re connected through our service line, etc. But we’re all connected. We don’t have people who, you know, one partner wants to do it one way, another partner wants to do it another way. You know what? If you want to do it a different way, then we’re all going to do it a different way and bring forward ideas. 

And I even encourage for 25 years before, you know, I’ve always encouraged the staff to, you know, we have an intranet site that says, “If I were managing partner, why would I do that?” Because some of the best ideas we’ve gotten as a firm was through that intranet site where people bring forward ideas. And, you know, if you reward people because we decided to use their idea, and you reward them publicly, people come forward. And, you know, I also have a theme of, you know, breakfast with managing partner. And every two weeks I go to a different office and I have breakfast with, you know, 10 to 12 people and I call it the Seinfeld Breakfast. It’s a breakfast about nothing. But we, you know, the only thing is you cannot bring forward an idea to change something, I mean, a complaint to change something unless you have an idea on how to solve the problem. That’s the only rule there. But we’re there to talk. I’m there to learn. And I want to hear what everyone’s perspective is. And obviously I want to hear their thoughts because their thoughts are important to me. 

Jean: Yeah. Absolutely. 

Lou: If people feel that their thoughts are important, they’ll bring forward their thoughts. 

Jean: Right. Right. Absolutely. 

Lou: And, you know, when we have our annual partner retreat, I go to all the offices and I let them know because what’s the biggest complaint? You know, when you interview people, you hear, “Well, I don’t know what the hell is going on at my firm.” Aha. Okay. Write that down. And obviously don’t make that mistake yourself. So that’s why I incorporated, you know, all of the things we do. So if we have our annual partner retreat and we come forward with a set of goals, I go to each and every office and bring everyone together in that office. And we roll out exactly what our plans are for the upcoming year so that everyone knows what’s going on in our firm. 

Jean: Yeah. That’s so important, right? To have that written plan so everybody’s on the same page, right? 

Lou: Yeah. And no one can say, “I don’t know what’s going on in the firm.” You know, we’re basically going to say, you know, “We’re going to grow this firm. You know, our organic growth rate is, you know, is going to be 10% for the year 2025. And, you know, we’re looking to open up offices in these places. Our leases are expiring in these offices and, you know, we’re exploring whether we should, you know, be in a different location.” Just let people know generally what’s going on in their firm and people love it and they adore it. I mean, they really do. 

Jean: Absolutely. Yeah. Now in 2023, Grassi implemented an employee stock ownership plan. One of the few accounting firms to do that. What drove you to make that choice and what did you think how it would impact the firm, whether it’s on the firm culture or growth or succession planning and what impact has it had? 

Lou: Okay. So obviously, you know, we were doing a hundred-million dollars and being approached by everyone, private equity in order to be a platform firm, other Top 100 firms to be part of their platform. And I always have been the person who always likes to do things different. It’s the way I’ve been since I was in grammar school. But I don’t like following trends. I like making things happen. But like I said, with studying the marketplace, and I knew that the private equity model, in my opinion, was not something that I would ever want to do. And I’ll tell you why. Our clients are our friends. They love us. We love them. The biggest thing we started to see is that most of our new business was coming from private equity firms. Firms that were acquired by private equity. We were getting a lot of business and I’m like, the business model just doesn’t work. And our clients are our friends. And if we no longer have any say in this process, then why… I couldn’t let people down. They put a lot of faith in us. I mean, it’s an honor to have someone as a client. 

So I had known a lot about ESOPs. And going back to the year 2000, one of the clients that I was really, really, really close with, someone came in and wanted him to do an ESOP. I did some background research on the company that was looking to take him to be part of that process. His fees were outrageous. He had a very checkered past. And I told them, “You know what, let me do this. Let me handle…I think you really should be an ESOP. I think you have the perfect situation to be an ESOP. But I am going to be an expert in this. Just give me a few months.” And they said, “Fine.” And they had a lot of faith in me. And lo and behold, I got in touch with the ESOP Association of America, read up on every publication that they had, went to their meetings and really became an expert. Obviously found out that it’s a very small community, spoke to the lawyers in it, etc. And I put forth a proposal to them and brought the cross-functional team of people. And they became an ESOP and they were very successful. 

Roll that forward to 2021. I’m at the client’s office. And the assistant to the CEO says, “Can you give me 15 minutes after you meet with Al? I’d like to have a private conversation with you.” And I said, “Okay, great. I’ll stay around for 15 minutes after.” So we go back into the conference room and she puts a piece of paper on there. And it shows that she has $1.9 million as her ESOP balance as of the last valuation. And she turns to me and she said, “This is all you.” And I said, “I don’t know what you’re talking about. They run the company. I don’t run the company.” She said, “No, this would have never happened.” She said, “I was a part of this. I know exactly what happened. This was all you. And I’m telling you, I’m an Indian immigrant. And I could have never imagined in my entire life to have this much money. And now I’m retiring because I can retire. And my entire family, I want to thank you on behalf of my entire family.” And I’m like, you know, I’m getting teary-eyed and, you know, it’s just a very, very powerful moment. 

I left there, got in my car and I looked up to God and I said, “God, I got you. You gave me the message, and I know you gave me the message and I know we’re going to move forward.” And I went to the next executive committee and I said, “I didn’t say we were going to do it.” And I said, “You know what, team? I think this is what we should explore. We handle 35 ESOPs. We know all about them. I think Grassi should be an ESOP.” I mean, it was difficulties because the laws in New York state were very arcane and non-CPAs could not be owners in a CPA firm. So, you know, we had to bifurcate and we had to have a, you know, into two different firms. We had to have an attest firm. We had to have a non-attest firm. So we had a lot of [inaudible 00:28:48] and took us about a year and a half. 

Jean: Right. But, like, what kind of reaction have you gotten from your people, Lou, or? 

Lou: Oh, my God. I mean, the people love it. You know, people are getting statements and someone is saying, “Oh, my God, you know, I’m worth a hundred-thousand dollars. You know, this is, like, unbelievable.” 

Jean: And it must be related to recruiting and retention and all that. That has to be a real differentiator. 

Lou: Well, you know what, it’s a few different categories because no one really has it locally. So we are different in that vein. But more importantly, we’re going to be forever independent and people really, really like that. Okay. People want to hear that we’re not going to be sold in two weeks. We’re, you know, a Top 100 firm, but we’re not going to be sold. And that’s all everyone hears because every week someone else is coming out and saying they sold themselves to private equity. And that’s all private equity. That’s never happening here. And people know that and people know that we’re going to be independent and we’re going to stay independent. 

And, you know, I do monthly webinars and I remind people, “We are all in alignment,” and I’m very honest with people. And I’m like, “Some of you need to start acting as owners because we’re all owners and we all need to be.” And I said, “There’s no more us versus you. There’s no more, I want to be a partner in this firm or I don’t know what, you know, the partners do, etc., etc. We are all owners. The old model is gone. We are all owners. We’re in this together. There is total alignment from top to bottom. There’s no more differentiation. We are all in this together.” 

And people love hearing that. And people love having, you know, that… 

Jean: And that’s more than in… 

Lou: How many times have you heard, “Well, you know, I’m making so much money for them.” Well, guess what? That money is all being made and shared amongst all of us. Those days of people saying that, “Oh, I made so much money for Lou Grassi,” those days are over. That model is gone. And it’s just a very, very powerful message. 

Jean: Right. I bet. 

Lou: And our staff retention, I mean, our staff turnover is now single digits. It’s, like, unbelievable. It’s single digits. And you know how many people we have so, you know… 

Jean: Yeah. It’s not a lot. 

Lou: …but we have a lot of people. And it’s a lot of people to make happy. But I think just doing it, because when I made the announcement, I mean, everyone thought like, “Oh, my God, Lou’s making this, you know, announcement and, you know, we’re going to be bought out by private equity.” And that was the biggest fear. And obviously, you know, there wasn’t a week that went by and, you know, don’t forget, this is happening over a year-and-a-half period of time, because, you know, we have to go through all of this, you know, we have to make all these regulatory changes. And during that period of time, you know, people would come in saying, “Oh, my God, I heard we’re selling, we’re going to sell to so-and-so. We’re going to sell to this firm, we’re going to sell to that firm.” And I said, “No, we’re not going in that direction at all. That’s all I can tell you at this point. But you have to believe me when I tell you, ‘We are not being sold to anyone.'” 

Jean: And that’s where transparent communication comes in, because, you know, you could be the real water cooler or the virtual water cooler. But if people aren’t given information and kept updated, a lot of things, you know, can go swirling in their heads about what’s happening, right? So let me take a turn. Well, we have people watching those things from all different-sized firms, we try to focus on those with 100 people or less. And I know at one point in your career, you know, you were that size firm, you know, before you were 500-plus, you know, person firm. What do you think is the most important capability for those firms under 100 people to develop in order for them to grow successfully, you know, into the future? 

Lou: Well, obviously, you need to have a plan. Hope is not a strategy. We all know that. And a lot of people get so caught up, take one of your people and let him or her figure out a plan for the firm that’s developed with all the partners. Get on the same page. The biggest problem with most CPA firms is not everyone’s on the same page. And if you can’t get everyone on the same page, then maybe it’s time for some people to leave. But if you’re really going to have a good firm and you really need…because you need to grow, I mean, you know, some people will say, “I need people.” And I’m like, “You need clients too.” 

And, you know, I was helping out a small firm, they had about 25 people. The managing partner was somebody I knew through the state society. And he’s like, “Lou, can you come in and help me out?” And he’s like, “No, no, I don’t need clients. I need people.” And I said, “Do me a favor. Could you give me your client list? And could you give me that same client list from two years ago?” And he goes and gets it. And we’re still in As. And there’s, you know, nine clients that are gone. And yeah, “Oh, well, they sold out. Oh, well, you know, there was a dispute between two siblings and, you know, we were on the wrong side of that.” And I’m like, “Okay, do you want to go into Bs or do you want B… Then I’ve proven my point that if you’re not growing this firm, you’re dying. And it’s a slow death, but you’re dying. So you need to have a growth plan. You need to have a mentoring plan. You need to make sure that people are happy. You’re not going to make everyone happy every day, clearly. But overall, you need employee satisfaction. You need to make them feel like they are connected to something. And you need client satisfaction. And you need a playbook. And you need a cross-functional team.” We have one rule at this firm. And it’s no one client is looked at by one set of eyes only. You just can’t do it because you’re leaving too much money on the table. You need a cross-functional team. We have a number of service models that we employ in the firm. But we have multiple people at multiple meetings with the client. So the client just doesn’t know one particular partner. 

And that’s the biggest problem. And with a lot of the smaller firms, you know, I would fly around the country a lot. One of the best things that happened to me at age 31, we had enough people so I can join, you know, one of the accounting associations. And that was the best thing. Because I learned so much on what I needed to do and so much of what I shouldn’t do, because I saw business models that just didn’t make sense or firms that imploded, etc. So by being a student of that, I realized, like I said, a lot of what I needed to do. But if I saw one particular firm that was really, really doing something exceptional, I went to visit that firm and spend a day or two with them. I called the managing partner saying, “I think you’re doing stuff really exceptionally. Mind if I spend a day or two, meet your team members and, you know, and just figure out how you’re doing it and why you’re so successful?” And, you know, you always have to learn and you have to be humble, you know. If you’re not humble, you’re not going to grow the firm. You need to be humble. You have to realize that you don’t have all the answers and that you need to learn from others. And I constantly learn from others. And I’m never afraid to ask someone, who’s doing something better than we are, to find out what they’re doing, how they’re doing it, etc. That’s a key ingredient. Talk to someone. 

We used to, you know, when we were 25 people, I’ll never forget this. You know, we said, “Wow, we’d love to be a 50-person firm.” And then I would say, “Well, if we want to be a 50-person firm, we need to find out what exactly a 50-person firm does. Let’s see what the successful ones do. Let’s go out and meet with them.” And I would go out and bring a few team members with me and we’d go out and meet successful 50-person firms. And, you know, we would take, you know, a little bit from this one, a little bit from that one. And we’d basically say, “We need to act today like a 50-person firm.” And that’s what we did. In other words, if you’re going to do something and you want to have a plan and a goal, you need a true plan. But too often, a lot of CPA firms don’t spend enough time working on the firm. You know, they’ll work in the firm, in the clients, etc., etc. But you need someone who’s picking their head up and looking beyond and looking out and basically saying, “This is what we need to do in order to achieve the goals we have.” 

Jean: Right. Absolutely. 

Lou: You know, I think just Monday becomes Tuesday with a lot of firms and there’s just no real plan. If you really want to be successful… 

Jean: You’re not taking that high-level view, you know, of how things are. 

Lou: You need that high level view. You need to see how you’re going to get there, what you need to do, and everyone needs to play a part. And I think that’s also part of our success is everyone played their unique part. You know, I always believe in one thing. You know, we had a growth consultant come to the firm 25 years ago. And after she was here a day, she asked to see me at the end of the day. And she said, “I’ve never seen a firm where everyone said, ‘Oh, no, growth is part of my goals.'” She said, “I usually hear, ‘Well, you know, I don’t really do new business. You know, I’m really more of a technician.'” And, you know, I always say one thing. Everyone to their own ability. And obviously people’s abilities are different. And you have to respect the fact that you have different abilities in the firm. Everyone to their own ability, no one exempt. No one should be exempt from anything. Okay. I don’t care if you say, “Well, you know, I do this.” Well, growth needs to be part of your goal because you run a book of business. If you run a book of business, you know, there’s additional revenue in that book of business. You need to bring a cross-functional team in. You need to bring in other people. You need to grow that book of business. You need to offer additional services. So that’s why no one should be exempt from anything because no matter what your abilities, maybe, you know, not going out, you know, at night and going to industry functions is your deal. Okay. Well then, you’ve got to do something to compensate for it, and compensate for it is tell me how much additional services you’re going to bring into that client book that you’re running on behalf of the firm. So like I said, you really, really need to have a plan. Everyone needs to participate and no one needs to be exempt from anything. No one should be exempt from anything. 

Jean: Right. Right. Okay. So I’ve got one more quick question before we end today. What do you hope the Grassi legacy will be known for 20 years from now? 

Lou: I would want the legacy to be as follows. They were a great firm. They cared about their clients. They cared about their people. They cared about their profession and they cared about the communities in which they operated in. That’s the only thing I’d ever want as a legacy and a founder of a firm. 

Jean: Wonderful. That’s wonderful. Well, I’ve been speaking with Lou Grassi, CEO, founder and managing partner of Grassi. Lou, thank you for sharing your stories with us today. 

Posted on December 19, 2025