[teleclimber]

I was thinking about investments the other day (I'm also trying to wrap my brain around this topic). I think it comes down to this:

An investment happens when the investor thinks the company will be worth more to another investor in the future.

That's basically it (and it's basically what you said). The second investor in the sentence above could be another VC, a buyer (M&A), or the stock market (IPO).