Buying vs. Building Companies, Which is Smarter?

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J.D. Graffam is a user experience expert and business leader. He founded his first business, Simple Focus, a digital experience company, in 2009. Today, he manages two digital agencies and six product businesses, all of which are bootstrapped and profitable.

His strategy is not to launch new products, but to acquire companies already launched.

On finding companies to buy

JD looks at for companies doing between $100k and $500k in annual recurring revenue.

Last company was called Curated, an email marketing tool for influencers. Litmus.com had acquired this founders company but they weren’t investing aggressively in Curated so he acquired on spin out.

His other products touch bug tracking, invoicing, and cash flow management.

Invoicing app and time tracking called Ballpark.

Cash flow management app is called Pulseapp.com

On “Printing Cash”

He does $750k in ARR across all of his small b2b saas companies. He takes 60-80% to the bottom line. He takes most of cashflow and re-invests in buying new companies.

He likes to buy and hold these companies and does not pursue buyers because he makes commitment to founders of these companies that he’ll take care of them when he acquires.

Famous Five:

Business Book: Good to great

CEO: Not following any

Favorite online tool: Goodtodo.com

How much sleep? 8 hours

JD is married with 3 kids, is 35, and wishes his 20 year old self knew that everything was going to be ok!