Industries in the Crosshairs

Part 3 of The Founder's Guide to AI-Enabled Roll-Ups

Not every industry makes a good AI roll-up target. The firms deploying billions into this strategy have specific criteria, and understanding what they look for tells you whether your sector—or your business—might be next.

The common thread isn't just "fragmented" or "ripe for disruption." Those phrases describe half the economy. What distinguishes AI roll-up targets is a specific combination of factors that make acquisition economics work and automation transformative.

This chapter profiles the industries attracting capital now—accounting, MSPs, call centres, legal services, and property management—and examines wealth management as the likely next major vertical. For each, I'll cover market dynamics, active players, what's actually being automated, and what owners should know if buyers come calling.

What Makes an Industry a Target

General Catalyst reviewed 70 industries before selecting where to deploy capital. Their criteria weren't arbitrary. They reflect what makes AI transformation economically viable at scale.

Six factors matter most:

Fragmentation with willing sellers. No dominant players controlling the market. Thousands of independent owners, many approaching retirement without clear succession plans. This creates deal flow—you can't roll up an industry if nobody wants to sell.

Labour-intensive operations. High headcount relative to revenue. Services are the delivered through human effort rather than software or physical assets. These businesses have the most to gain from automation because labour is their primary cost.

30-70% task automation potential. This is the sweet spot. Below 30%, the transformation isn't dramatic enough to justify the effort. Above 70%, you're essentially replacing the business entirely—which requires different capabilities. The middle range means AI augments human work rather than eliminating it.

Stable, recurring cash flows. Roll-ups require debt. Debt requires predictability. Businesses with project-based or volatile revenue don't support the leverage that makes acquisition economics work. Retainer-based professional services with sticky client relationships fit perfectly.

Succession pressure. Ageing owners without internal buyers create motivated sellers. When the alternative is closing the practice and walking away, a well-structured offer looks attractive. Both the accounting and wealth management industries face demographic cliffs approaching.

Professional services premium. Relationship-based businesses command higher multiples because clients don't leave easily. A CPA firm's clients have been filing taxes with that firm for decades. An MSP's clients have integrated systems. This stickiness protects against post-acquisition churn.

The industries currently attracting AI roll-up capital check most, if not all, of these boxes. The ones that don't—restaurants, retail, construction—might be fragmented, but they lack the automation potential or cash flow stability that makes the model work.

Accounting & Tax Services

Accounting is ground zero for AI roll-ups. More capital, more activity, and more proven results than any other vertical.

The opportunity exists because the industry is simultaneously massive, fragmented, and facing a workforce crisis with no obvious solution.

Market snapshot:

• US market size: $145.5B (2025)
• Number of firms: 85,000+
• Workforce decline: 300,000+ accountants left since 2020 (17% shrinkage)
• Retirement pressure: 75% of CPAs are at or nearing retirement age
• CPA exam participation: Down 30% since 2016
• Hiring difficulty: 90%+ of finance leaders report trouble finding qualified professionals

The talent pipeline isn't just constrained—it's collapsing. The 150-credit-hour CPA requirement, long hours during busy season, and competition from tech and finance for the same graduates have created a structural shortage that conventional solutions won't fix.

For AI roll-up platforms, this is the opening. If you can't hire enough accountants, automate what accountants do.

What's Being Automated

The automation isn't theoretical. Crete Professionals Alliance, the Thrive-backed platform, reports AI tools saving "hundreds of hours every month" in audit testing alone at individual member firms.

Specific applications include:

• Data mapping and document extraction — Pulling numbers from source documents into working papers
• Audit testing and sampling — Automated selection and verification of transaction samples
• Tax return analysis — Identifying errors, optimisation opportunities, and compliance issues
• Memo and report generation — First drafts of engagement letters, management letters, and financial statement notes
• Compliance monitoring — Tracking regulatory changes and flagging affected clients

The result: accountants handling 2-3x more clients without proportional headcount increases. That's the margin expansion that justifies premium acquisition multiples.

Key Players

Crete Professionals Alliance (Thrive Holdings)

• Revenue: $300M+
• Employees: 900 across 17 offices
• Partnerships: 20+ accounting firms
• New acquisition budget: $500M over 24 months
• L&D investment: $10M/year

Accrual (General Catalyst)

• Raised: $16M
• Approach: Alternative to Thrive's model—building technology first, acquiring distribution second

What Accounting Firm Owners Should Know

If you own a CPA practice, you're likely receiving more acquisition interest than ever. The dynamics favour sellers: multiple well-capitalised buyers competing, succession pressure creating urgency on the buy side, and AI transformation creating genuine strategic value beyond traditional consolidation.

Typical deal structures include 60-70% majority stakes with 30% founder retention through equity rollover. Brands are generally preserved. Founders stay involved operationally, at least through transition.

The questions to ask any buyer:

What AI capabilities do you have deployed today? Not planned. Deployed. Ask for specific examples and results from other acquired firms.

What happens to my team? AI roll-ups shouldn't mean mass layoffs—they should mean accountants doing higher-value work. But get specifics.

What's your capital structure? Evergreen or permanent capital means no forced timeline. Traditional PE funds have clocks ticking.

Can I talk to other sellers? Their experience tells you more than any pitch deck.

IT Services / MSPs

Managed service providers are the second major vertical, with Shield Technology Partners and Titan MSP building AI-native platforms through acquisition.

The MSP market shares accounting's fragmentation and succession pressure, but adds a technology-native workforce that should theoretically adapt faster to AI augmentation.

Market snapshot:

• Global managed services market: $335B+ (2024)
• US market: $64B (2025), projected $108B by 2030
• US providers: 40,000+
• Global providers: 130,000-150,000 (varying definitions)
• Concentration: Low—PE-backed roll-ups increased deal volume 50% in 2024
• Enterprise outsourcing: 68% of enterprises outsource at least one IT component to MSPs

The industry structure creates natural acquisition targets: thousands of regional MSPs with $2-20M in revenue, owner-operators approaching retirement, and technology that's increasingly commoditised around a few major vendor platforms (ConnectWise, Datto, Kaseya).

What's Being Automated

Titan MSP's pilot programs demonstrated 38% of typical MSP tasks are automatable with current technology. That's not a projection—it's measured results from real implementations.

Specific applications:

• Help desk triage — AI resolving routine tickets (password resets, common errors) without human intervention
• Client onboarding — Processes that took weeks compressed to minutes through automated discovery and configuration
• Security monitoring — Continuous threat detection with AI-flagged anomalies for human review
• Vendor management — Automated procurement, licensing, and renewal tracking
• Proactive maintenance — Predictive identification of issues before they cause downtime

Shield Technology Partners has developed internal products—Sentinel and Spectre—specifically to auto-resolve repetitive tickets across their portfolio companies.

Key Players

Shield Technology Partners (Thrive Holdings + ZBS Partners)

• Funding: $100M+
• Acquisitions: 7 MSPs (ClearFuze, IronOrbit, Delval, OneNet Global, NetAscendant, BCS365, SK Tech Group)
• Target: Double acquisitions by Q1 2026
• CEO: Jim Siders (former Palantir CIO)

Titan MSP (General Catalyst)

• Funding: $74M (August 2025)
• Recent acquisition: RFA (400+ financial services clients)
• Automation rate: 38% of tasks in pilot programs

What MSP Owners Should Know

The MSP acquisition market is heating up, driven by both traditional PE consolidators and the newer AI-focused platforms. Deal structures tend to include rolling liquidity every 3-5 years, brand preservation, and—critically—retention of existing tech stacks during integration.

The AI platforms differentiate by offering genuine transformation rather than just back-office consolidation. If a buyer can't articulate specifically how AI will improve your operations, they're probably traditional PE in new packaging.

Questions to ask:

What happens to my tech stack? Rip-and-replace is expensive and risky. Better platforms work with what you have initially.

How do you handle client relationships during transition? MSP clients chose you for a reason. Disrupting that relationship destroys value.

What training do my technicians receive? AI augmentation should make your team more valuable, not redundant.

Call Centres & Customer Service

Call centres represent the most dramatic margin transformation in the AI roll-up universe. Crescendo's 60-65% gross margins—versus the industry standard of 10-15%—demonstrate what's possible when automation reaches 80%+ of interactions.

Market snapshot:

• Global outsourcing market: $100B+ (2024), projected $164B by 2030
• US market: $23B (2024)
• Global agents: 6+ million in outsourced operations
• Annual attrition: 30-45% across major hubs
• Traditional margins: 10-15%

The industry's chronic problems—high attrition, difficult staffing, 24/7 requirements, thin margins—become AI's opportunity. Every pain point that made call centres difficult to operate becomes a transformation lever.

What's Being Automated

Crescendo claims 80-90% automation of routine customer inquiries, with seamless human handoff for complex issues. The AI handles initial contact, information gathering, and resolution for standard requests. Humans step in when judgment, empathy, or escalation of authority is required.

The transformation extends beyond just answering calls:

• Quality assurance on 100% of interactions — Every call reviewed versus the traditional 1-2% sample
• Multi-channel support — Voice, chat, email, and social handled through unified AI systems
• Real-time agent assistance — AI suggesting responses, surfacing relevant information, flagging compliance issues during live calls
• Predictive staffing — AI forecasting call volumes and optimising schedules

Customer satisfaction metrics reportedly improved across Crescendo clients—Lovepop and EVPassport documented CSAT increases after implementation.

Why This Vertical Is Different

Call centres are the clearest "before and after" in AI roll-ups. The margin transformation from 15% to 60%+ isn't an incremental improvement, it's a fundamentally different business model.

The catch: this level of automation requires significant technology development. Crescendo spent years building its platform before acquiring distribution. Replicating their results isn't as simple as buying a few call centres and plugging in ChatGPT.

For call centre owners considering selling, the key question is whether a buyer has the technology to actually transform your operations, or whether they're hoping to figure it out after the acquisition.

Legal Services

Legal is the emerging vertical, earlier stage than accounting or MSPs, but with similar structural characteristics that make it attractive.

Market snapshot:

• US market: $400B (2024)
• Number of firms: 45,000+ practices competing outside the top 200
• Concentration: Low—no firm exceeds 2% market share
• First-year associate pay: $215,000+ at leading firms (2025)
• Recruiting costs: $230,000+ per associate

The fragmentation exists. The labour costs are substantial. The automation potential is real. What's different is regulatory complexity—state bar requirements, ethical rules, and fiduciary obligations create friction that slows transformation.

What's Being Automated

Eudia, General Catalyst's legal portfolio company, has signed Fortune 100 customers, including Cargill, Del Monte, and Stripe. Their model: fixed-fee legal services powered by AI, rather than hourly billing.

Specific applications:

• Contract analysis — Reviewing agreements for risks, missing terms, and negotiation opportunities
• M&A due diligence — Processing data rooms and flagging issues at a speed impossible for human review
• Compliance management — Tracking regulatory requirements across jurisdictions
• Document review — The original legal AI use case, now significantly more sophisticated
• Legal research — Finding relevant precedents and statutory interpretations

EY's SARGE platform reportedly achieved 75% reduction in compliance review time for certain workflows—suggesting the automation potential exists even in heavily regulated work.

Why This Vertical Moves Slower

Legal services have transformation potential but face barriers that other industries don't:

State-by-state regulation. Each jurisdiction has its own bar requirements. What works in Arizona (which now authorises non-lawyer ownership of law firms) doesn't work in New York.

Malpractice liability. Errors in legal work create legal exposure. AI-assisted mistakes raise novel questions about responsibility and insurance.

Partnership economics. Law firm ownership structures don't translate cleanly to PE-style acquisitions. Alternative business structures are emerging but remain uncommon.

The opportunity is real, but execution is harder. Expect legal AI roll-ups to develop more slowly than accounting or MSPs, with early movers like Eudia establishing proof points that unlock broader capital deployment.

Property Management

Property management is the UK proving ground—General Catalyst's Dwelly has demonstrated that the model works in a market with fragmentation similar to the US.

Key results:

• Acquisitions: 6 agencies
• Properties managed: 2,000+
• EBITDA improvement: 2x margins where AI is fully deployed
• Repair resolution: 40% faster
• Maintenance improvement: 33%

The automation covers the operational headaches that consume property manager time: open house coordination (now fully autonomous), maintenance triage and contractor dispatch, tenant communication, and rent processing.

The US market is larger and similarly fragmented, but no major AI roll-up platform has emerged yet. That's likely a timing question rather than a structural one—the Dwelly results suggest the economics work.

For property management company owners, the pattern from other verticals applies: expect acquisition interest to increase as platforms prove the model and seek new markets for deployment.

Wealth Management: The Next Major Vertical?

Wealth management isn't an AI roll-up vertical yet. But it has every characteristic that makes one work, and the capital is clearly interested.

Market snapshot:

• SEC-registered RIAs: 15,870+
• 2025 M&A deals: 370+ transactions, $2T+ AUM transacted through November
• PE influence: 79% of transactions are directly or indirectly PE-influenced
• PE-backed RIA growth: 16% increase in PE-owned RIA count year-over-year
• AUM controlled by PE-backed RIAs: $6T (23% of all $100M+ RIA assets)
• Retirement pressure: 37% of advisors retiring within 10 years

The succession pressure looks nearly identical to accounting. The fragmentation is similar. The recurring revenue model fits perfectly. And PE has already proven the acquisition economics work through traditional consolidation.

What's missing is the AI transformation layer.

The Automation Opportunity

Wealth management has clear automation targets:

• Meeting prep and notes — Hours of preparation compressed to minutes
• Client onboarding — Manual processes taking 4-6 hours reduced to ~1 hour
• Tax analysis integration — Automated coordination with client CPAs
• Compliance and KYC — Documentation requirements handled systematically
• Alternative investment processing — Operational complexity of private market allocations simplified

Target margin improvement: 20-30% → 35-45% (per General Catalyst estimates for similar professional services).

Why It Hasn't Happened Yet

Two barriers slow wealth management AI roll-ups:

Fiduciary complexity. RIAs have legal obligations to act in clients' best interests. AI-assisted recommendations raise questions about disclosure, liability, and regulatory compliance that don't exist in accounting or MSPs.

SEC attention. The SEC fined firms $8.2B in 2024 for various violations, including increased scrutiny of "AI-washing"—firms claiming AI capabilities they don't actually have. Marketing AI features in wealth management invites regulatory attention.

These barriers slow but don't prevent transformation. The structural opportunity is too attractive for capital to ignore indefinitely. Expect AI-focused wealth management platforms to emerge within 12-24 months, likely from firms that have proven the model in adjacent verticals.

What RIA Owners Should Know

PE-backed buyers already dominate IFA/RIA M&A. Adding AI transformation to the value creation thesis will accelerate interest in firms with:

• Recurring AUM-based revenue
• Operational complexity that AI can simplify
• Succession pressure or growth capital needs
• Client bases that would benefit from enhanced service capacity

If you own a financial advice business, you're already a target. The question is whether you sell to traditional consolidators, optimising current operations, or wait for AI-focused platforms offering genuine transformation.

What's Next?

The criteria that make industries attractive—fragmentation, labour intensity, automation potential, recurring revenue, succession pressure—apply beyond the verticals already attracting capital.

Industries to watch:

HR and staffing agencies. Highly fragmented, process-intensive, and ripe for automation of candidate screening, job matching, and administrative workflows.

Insurance brokerages. Similar structure to wealth management—relationship-based, recurring revenue, ageing owner demographics.

Healthcare administration. Revenue cycle management, medical coding, and practice management have clear automation potential, though regulatory complexity adds friction.

Marketing and creative agencies. AI content generation is already transforming workflows. Consolidation could follow.

The pattern repeats: wherever you find thousands of small businesses doing similar work by hand, AI roll-up capital will eventually follow.

For founders and owners in these industries, the strategic question is timing. Early sellers capture premium prices from buyers seeking proof points. Later, sellers face more competition and established platforms with bargaining power.

The window between "this is speculative" and "this is inevitable" is when the best deals happen.

← Back to Chapter 2: The Money Behind the Movement

Continue to Chapter 4: Inside the Technology Stack →

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