What is link building?

For search engines that crawl the web, links are the streets between pages. Using sophisticated link analysis, the engines can discover how pages are related to each other and in what ways.
All Links are Not Created Equal: 10 Illustrations on Search Engines' Valuation of Links

Google's founders created an algorithmic method to determine importance and popularity based on several key principles(http://infolab.stanford.edu/~backrub/google.html):

Links on the web can be interpreted as votes that are cast by the source for the target

All votes are, initially, considered equal

Over the course of executing the algorithm on a link graph, pages which receive more votes become more important

More important pages cast more important votes
The votes a page can cast are a function of that page's importance, divided by the number of votes/links it casts

Link Signals

Used by Search Engines

Global Popularity

Local/Topic-Specific Popularity

Anchor Text

TrustRank

Link Neighborhood

Freshness

Social Sharing

Link Building Strategies

Resources/Links pages, Time: 2-4 weeks, Dependencies: Marketing, design, development, Link Value: Moderate-High.

Profile links (www.crunchbase.com), Time: 1-2 weeks, Dependencies: None, Link Value: Moderate.

Ask people you know for a link, Time: 1-2 weeks, ongoing, Dependencies: None, Link Value: High.

Get people to see your content, Time: 12+ weeks, ongoing, Dependencies: Social, Link Value: High.

Build relationships Time: 12+ weeks, ongoing Dependencies: Social, customer service Link Value: High.

Link building is a process in which you submit your site url to other high pr websites by following methods:

Link building is a process in which you submit your site url to other high pr websites by following methods:
Article submission
Blog creation
Directory submission
Social bookmarking
Press Release
Use of social Networking
Forum posting
Blog Comment

Thanks to capture my attention again about link building.