IMG_20130725_193045Since a VC is only as good as his deal flow, reputation and branding among entrepreneurs is extremely important to venture investors.

That’s why a lot of VCs blog — to build up a brand. Among the most well-known blogging investors is Bill Gurley of Benchmark Capital, who started his blog, “Above the Crowd,” 20 years ago as a fax that he spammed to the attendees of a tech conference he went to.

“A VC’s biggest concern is that they’re going to miss the next Google,” Gurley said tonight at PandoMonthly in San Francisco. “So they’re constantly marketing to the entrepreneur they haven’t met yet.”

This is also why venture firms never give a hard “no” to founders — you never know who’s the next Mark Zuckerberg, and you gotta keep your options open. For that reason, many later stage VC funds have crept down into the seed stage arena. They can afford to lose money on a “spray and pray” method of investing, so they have the option to invest in the winners once they raise an A round.

The problem with that is that if you don’t back your seed stage investments when they raise a Series A or B round, there is a “signaling problem” that makes other VCs wary to invest. That can hurt a company, but it’s just as damaging to a VC firm’s reputation. And reputation and branding is as fragile as ever with the hyper-transparency of blogs and Twitter.

Benchmark hasn’t crept into seed stage investing because of that problem. And because the firm is worried about attaching its brand to so many passive seed investments. “Having passive investments is having your brand walk around without the work that you want to be known for,” he said. “It’s unscalable and we can only sit on so many boards. We don’t want to be involved and not involved.”

So Benchmark has stuck to its knitting in later stage deals. The FOMO (Fear Of Missing Out, or in this case, FOMOOTNG — Fear Of Missing Out On The Next Google) is palpable, though. Gurley mentioned the danger of missing the next big thing at least five times throughout the interview. And with the cost of starting a business as low as it’s ever been, the pressure for VCs to identify companies early on is even higher. They simply don’t need as much money to get started. And still, Benchmark has backed big companies like Twitter and Snapchat earlier than many.

Gurley is comfortable going up the stack and waiting for traction for consumer Internet investments, though. “A lot of the big wins, even if its Facebook and Google, were all funded post-traction. These products have been in the market and were out there competing as opposed to funding two people in a Powerpoint. That created a window for the angel community to come in,” he said.

And he’s happy to let them own the seed stage.