The Marcum Retrospective – Part 1
This week marked the 23rd anniversary of the 9/11 attacks, which overshadowed another significant milestone for me personally: the anniversary of my first day with Marcum. And with our upcoming sale to CBIZ, Inc. (“CBIZ”) anticipated to close in the fourth quarter of this year, it’s bound to be my last anniversary working for a firm called Marcum.
On Friday, September 11, 1981, a then 24-year-old CPA joined a small, little-known accounting firm in Syosset, Long Island, called Marcum & Kliegman. Founded by Edwin Marcum and Edwin J. Kliegman in Flushing, New York, in 1951, 30 years later, Marcum & Kliegman was a firm of six people, billing $300,000 annually. Last year, our revenue was 4,000 times that amount.
I was the seventh person when I joined the firm that September Friday, after spending my first two years in the accounting profession at one of the then “Big Eight,” and the last 40 years have been a hell of a ride. Who would have imagined that after 43 years at Marcum, we would create one of the new generation of Big Eight accounting firms? When our sale to CBIZ closes, we will be the seventh-largest accounting firm in the country. I guess things do come full circle.
By 1985, we had doubled in size, Ed Marcum was turning 65 and ready to retire, and I was fortunate enough to inherit his client base, which included the world-renowned, best-selling novelist Robert Ludlum. I also assumed his role as the firm’s administrative partner, which at that time basically entailed signing checks.
So, Ed Kliegman and I continued to build the firm, and by 1990, we had about 25 people, including five partners. It was time for us to add more structure to our growing practice, so I was elected our firm’s first Managing Partner, a role I had until 2017 when my title changed to Chairman & CEO.
Ed Kliegman retired at the end of 1991, and we continued to build the firm. The Marcum partners at the time were Bart Friedman, Larry Scheinthal, Brian Miecnikowski, Jim Ashe, and Phil Strassler. All of them were there at the beginning of modern-day Marcum, and we couldn’t have accomplished what we did without them at the beginning of all of this. Our next milestone occurred in 1996 when we became a two-office firm by expanding into New York City with the addition of David Bukzin (our Vice Chair) and his practice. And we continued to grow.
The early 2000s were very good to us. We continued to expand our core clientele of privately held, entrepreneurial family businesses while developing a client base of hedge funds, private equity funds, and small publicly traded companies. We were in the right place at the right time when the Sarbanes-Oxley Act was enacted in 2002. Many in the accounting profession dubbed it “The Accountants’ Full Employment Act.” Marcum & Kliegman continued to grow.
By the summer of 2008, we were 450 people working out of two offices in Woodbury, Long Island, and New York City. And then, as they say, “the music stopped.”
Bear Stearns went out of business in March 2008, Lehman Brothers was failing and ultimately went out of business in September, and the liquidity in the capital markets that had fueled the economic growth of the 2000s suddenly dried up. The economy froze and actually started to contract for the first time in my working career. And Marcum & Kliegman felt it. So, we needed a new game plan.
Our executive committee at the time embraced the idea that if we weren’t going to grow organically, as we had done since the beginning, we had to continue to grow; however, the way would be through mergers & acquisitions (M&A). We quickly created a strategic plan that had us looking for suitable M&A targets in the top 15 business markets in the country: Los Angeles, San Francisco, Chicago, Boston, Miami, Philadelphia, Houston, Dallas, Denver, Atlanta, Seattle, and Detroit, to name a few.
Two short years later, by the end of 2010, we were able to expand into South Florida (by merging with Rachlin LLP), Philadelphia (by merging in Margolis & Co.), LA and San Francisco (Stonefield Josephson). We doubled in size to 900 people in nine offices and became a national firm. In 2009, we changed the name of the Firm from Marcum & Kliegman to Marcum LLP. My phone call to Ed Kliegman to let him know we were dropping his name was one of the most difficult of my professional career, but Ed, with his trademark character and grace, understood the reasons behind the change and gave us his blessing to do it.
The rest, as they say, is history.
Today, we are over 4,000 strong including 540 partners. And we’re continuing to grow.
Stay tuned next week for some insight into our strategic growth plan and Part 2 of The Marcum Retrospective.
