The formal process of estimating the work of the business. Various valuation methods include capitalization of net earnings, present value of future earnings, asset based evaluations, and market comparisons. If a valuation is being done for estate and gift tax purposes, it needs to comply with IRS Ruling 59-60.
A source of funding that looks to take an equity position and affirm at an early stage of the company's development. The VC most often will invest in companies that show promise of becoming public companies within 5 to 7 years of their investment.