Oct 25 - I am considering purchasing a business with excellent cash flow but the value of the tangible assets is only about 30% of the asking price. Should I be willing to pay more than the value of the assets?

Are you interested in owning the assets or making money? If the answer is to make money then you must realize that people buy businesses for the cash flow stream they generate. Buying a solid existing business eliminates most of the risk inherent in a startup and allows one to see a profit immediately versus one to three years for a startup. Is this worth a premium over the asset value? You bet it is. Businesses sell for multiples of earning. If you want to just own assets go to a liquidation auction.