Ben Lerer, managing partner of one of New York’s most prestigious seed-stage venture firms, Lerer Hippeau, shared some predictions with Fortune’s Leo Schwartz.

He believes venture firms will continue to see a bifurcation as money pours mostly into top funds like Thrive and a16z, as well as into smaller more bespoke funds. 

“Where you go to die is somewhere floating in the middle, managing a few billion dollars, and don’t do anything particularly well,” he told Schwartz. 

While a few billion dollars is certainly not chump change, a lot of firms have struggled to raise since the end of 2021’s spending spree. The Financial Times also reported earlier this month that the number of active venture firms in the U.S. has started to decline as cash flows to only the top names. Perhaps the biggest example of a top-name VC firm announcing in 2024 that it would shutter was Foundry Group.