All those LPs are taking their liquidated investments and putting them somewhere else. Probably in large part that somewhere else is more-successful VC firms.
I wouldn't be surprised if that somewhere else is currently hedge funds and private equity at the moment, though. Those sectors are huge at the moment, and their growth has to have come from somewhere. I think a more likely explanation is that money fled venture capital after the tech bust and came to rest in hedge funds and private equity, and now that those bubbles are about to burst, it'll likely go back to venture capital. Or maybe blue-chip stocks.
All those LPs are taking their liquidated investments and putting them somewhere else. Probably in large part that somewhere else is more-successful VC firms.