By An Maes
The European accounting sector is facing a sharp structural divide. As private equity transforms the industry, a ‘generalist gap’ has opened between high-value artisan boutiques and massive, tech-led consolidators. For firms to thrive in 2026, they must move beyond the ‘adequacy trap’ and choose a definitive path between specialisation or scale.
Across the European accounting landscape, a long-standing comfort zone is vanishing. For decades, the mid-sized generalist firm – typically 20 to 100 people – was the gold standard of the profession. But as we move into 2026, the ground beneath these firms is shifting.
The industry is no longer a smooth gradient from small to large. Instead, it is splitting into two high-performing extremes, leaving what we call the ‘generalist gap’ in the middle. This isn’t just a change in firm size; it’s a total divergence in how accounting is sold, delivered and valued by the market.
The two new profiles of success
The capital flowing into the sector right now isn’t looking for average performance. With over 150 private equity firms active across Europe, investors are backing two very specific models.
The artisan specialist
These firms have traded breadth for depth. They don’t try to attract every client but instead they own a specific niche. As a result, they command premium fees by providing a level of certainty that a generalist simply cannot match. They use technology to punch above their weight, allowing small teams to generate big revenue.
The scaled powerhouse
At the other end, consolidators are winning through the industrialisation of accounting. They invest millions into standardised systems that ensure consistent quality at a massive scale. They don’t rely on partner heroics for every file. Instead, they rely on optimised workflows. Their size allows them to price compliance work competitively while maintaining healthy margins through pure efficiency.
The adequacy trap
Firms falling into the generalist gap are those caught between these two poles. They are too small to have the innovation budget of a 1,000-person firm, yet too broad to claim the elite status of a specialist.
This is the ‘adequacy trap’. It is the danger of being pretty good at everything in a market where clients now demand either extreme expertise or extreme efficiency. When a client can choose a specialist who lives and breathes their industry, or a scaled provider that offers a seamless digital experience at a lower cost, the generalist at a mid-market price becomes a hard sell.
The innovation friction
The biggest hurdle for firms in the gap isn’t a lack of talent but the friction of the billable hour.
When a firm’s financial health is tied to 65% utilisation, every hour spent on the future is an hour stolen from today’s revenue. Partners know they need to experiment with AI, rethink their service lines and train their staff on advisory skills. But in a billable-heavy model, that experimentation often feels like a direct hit to the bottom line.
The firms successfully crossing the gap are those that have productised their knowledge. They’ve moved to value-based pricing or subscription models that allow them to decouple their income from the clock. This creates the oxygen needed to innovate.
The advisory margin killer
We’re also seeing a new phenomenon involving the ‘always-on’ client. With 42% of European accounting firms now using AI tools for initial financial questions, clients are arriving better informed but with higher expectations for instant validation.
If a firm has moved to real-time data visibility but is still charging like a traditional compliance shop, they’ve accidentally created a margin killer. They end up providing constant, high-level advice via quick calls and messages that never get invoiced.
The winners in 2026 aren’t just doing more advisory work, they’re packaging it. They offer fixed-fee strategy sessions and tiered support levels. They understand that if you don’t set boundaries around your expertise, you end up giving it away for free.
Three vital signs for 2026
Partners should look at these three indicators to see if they are drifting into the gap.
Revenue vs. hours: Does your revenue grow only when people work more hours? If so, you’re a time-seller and you’ll struggle to fund the technology needed to stay competitive.
Niche dominance: Can you name one specific area where you are undeniably the best in your region or vertical? If your value proposition is just ‘great service for all SMEs,’ you’re competing on price rather than value.
Systematised delivery: Could your firm function if the top three partners took a three-month sabbatical? If the answer is no, your expertise is a bottleneck rather than a scalable asset.
Choosing a direction
The safe centre of the accounting market is hollowing out. In 2026, the most successful firms will be those that had the courage to stop being generalists.
Whether you choose to become a hyper-focused artisan or a tech-enabled scale player, the most important thing is to pick a lane. The firms that thrive will be those that fund their transformation while they’re still successful – rather than waiting until the generalist gap becomes a hole they can no longer climb out of.
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