Tuesday

I think I Will Leave My Job at the Big Four to Go Work for a Small Firm

Another avenue of escape from the Big Four is to go work for a small shop with two or three principals and a handful of associate accountants.

This is an attractive option for those who don't like being a small fish in a big pond:

And would rather be a big fish in a small pond:


But before you jump ponds, be aware of what you are getting into. Talk to people who have done it recently -- especially those at the firm you are going to. We know one guy who jumped from big pond to little pond and about drowned in the middle of the first busy season. Here are the lessons we learned:

Big Four Big Pond v. Little Firm Little Pond

1. Pay curve. Until you become the biggest fish in the little pond, you are not going to eat very well. The salary curve for little ponds starts lower and has a very flat slope for several years, and a high risk of the curve never getting any steeper. On the other hand, for the aggressive fish in the little pond, if you can build up your own book of business you can surpass your big pond fish in salary in not too many years. As always, lots of variables. Investigate your little pond carefully before making the jump. Look at when the principals will most likely retire and how easy it would be for you to take over their book of business.

2. Hours Control. While not always true, you generally have more control over your hours in a Big Pond because there are more fish who can help you out in a squeeze and better time management tools. If you are one of the only fish in the little pond, however, you can easily find yourself underwater and unable to turn down work. The fish we know that jumped into a little pond got killed his first busy season and was working far more hours than he had been the previous season when he was a senior at KPMG. But the advantage with little ponds is that you can sometimes work out an agreement with the principals for a fixed number of hours -- not always the case, but more likely than at the big ponds.

3. Cool Clients. One of the bonuses of being in a Big Pond are the Big clients. While the work is not glamorous, it sure sounds glamorous to your friends when you tell them the names of the big sexy clients for whom you are working. At least it sounds a lot better than the little pond clients like Al's Muffler.

4. Jumping Back to Big Pond. Once you jump out of the big pond and get acclimated to the little pond, it's tough to jump back to the big pond later on. Not impossible, but tough. The other problem is your resume if you try and jump out of the little pond a few years down the road. To most employers (especially snobby ones like public companies), five years in the Big Pond usually looks better on a resume than two years in the Big Pond and three years in the Little Pond.


26 comments:

  1. Anonymous9:03:00 PM

    Interesting post. Here are my own observations on the topic as I have considered this path. If you are in audit at a big four, you will have a major learning curve at a small firm since the work they do is tax. To help this, consider doing tax prep for free through non-profits such as VITA. (Also, if you hate taxes, then you will hate your life since some accountants do hundreds upon hundreds each season.) (the forums at taxalmanac.org are a great resource for people seriously considering this)

    If you are not good at sales (e.g. talking to people), then be careful going to a smaller firm since you will be directly interacting with clients and responsible for bringing in new ones.

    Going back to bigger accounting such as big four, controller, etc will prove to be difficult since people in those positions might look down on smaller accounting experience.

    That blackberry, laptop, paid for cpe credits, health insurance, other perks - say goodbye to them when joining a small practice.

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  2. Agreed, nice analogy throughout, plus the additional information in the comments.

    CPA/CA exam training probably (definitely) won't be at the same level either.

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  6. This is great info for those who are fresh out of the univs and plan to dive into the job market, as well as old pros who want a change of scenery career-wise. It makes one think of his choices, weighing down the pros and cons of working in the "big ponds". One thing that you can also consider is the resources you could work with while working in a big pond versus a small pond, like tech and software, which I think is highly variable. This gives you a nice point of reference.

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  9. The big four have huge marketing budgets and often sell “the dream” to students before they graduate. If that’s the case, then why is the leavers rate so high at big four firms?

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    All profits from our website are donated in equal portions to the charitable organizations managed by EY, Deloitte, PwC and KPMG.

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