NC Trend: DNA of a CPA
Call him the Dean Smith of North Carolina accounting: Ken Hughes, 63, has mentored hundreds of CPAs. He joined an Asheville firm in 1980 with 10 employees and is retiring as chairman of Dixon Hughes Goodman LLP with 230 partners, 32 offices and more than 1,800 employees in 12 states. The Charlotte-based accounting firm is North Carolina’s largest, with $375 million in revenue last year. Comments were edited for brevity.
How did your business start?
I grew up in Burnsville and went to Western Carolina University. Then I worked for a national firm for several years before reconnecting with my former college professor, Monty Lindsey, who had formed a small accounting firm with Mitch Crisp with offices in Waynesville and Sylva. We rented an office in Asheville and started without any clients.
How did you grow?
When you have no business, you just hustle. I learned that if you don’t go out and get business, you aren’t going to eat. Our first audit client paid $4,500, and in our first year in business, we brought in about $250,000 in revenue. I would tell people that others may be smarter but no one would outwork me.
When did your growth accelerate?
What propelled Crisp Hughes was entering Atlanta in 1997. We had offices in Durham, western North Carolina and upstate South Carolina. That was our first foray into a really large market, and it elevated our thinking to a different level. We started with about 15 people. Now we have more than 150 working in our four major industries: insurance, health care, auto dealerships and banking.
What about the 2004 merger with High Point-based Dixon Odom?
That was our real milestone. Their CEO, Eddie Sams, and I had similar strategies and a desire to be the dominant firm in the South. There were about five firms of a similar size and no one had broken out or had a competitive advantage. We thought we could put it together and differentiate ourselves from other regional firms.
So size matters?
Our merger came around the time of the Enron and Arthur Andersen scandals and the Sarbanes-Oxley law, so there was a lot of work to go around. We were a beneficiary of having enough size to be a good alternative to the national firms. (Sarbanes-Oxley requires that top executives of public companies certify that financial reports comply with accounting rules.)
How did you determine the firm’s leadership?
Eddie and I had gotten to know each other over the previous five or six years, before the merger. We’d often meet off [Interstate 40’s] Exit 125 in Hickory at the Cracker Barrel or the Steak & Ale and talk about our philosophies. We became co-CEOs, and everyone told us that wouldn’t work, but we worked hard to make it work. We agreed that we would cover each other’s back and we wouldn’t disagree publicly. (Sams retired in 2013.)
How did Matt Snow get picked as the new CEO in 2014?
We went through an exhaustive process and Matt stood out. He had been a successful partner with a national firm in Greenville, S.C., before joining us in 2007. He has a wide breadth in both client service and technical areas. Our partners chose him.
Faith, family, friends, financial and fitness – those are the things for which I have a passion. Once I retire, I’ll take some time to reflect on what comes next.