VCs are basically good people. They are hitting a bad patch where the money they are raising is diminishing by 75% ($200B à $50B). The traditional VCs that require $5 million revenue and a complete management team and provide expansion capital are the ones most impacted.
A new entrant called a micro VC which have funds of $20 to $60 million are now major players in the Angel world. Somewhat confusing is that many of these funds are known by an Angel who is the founder of the fund. These angels are referred to as Super Angels.
A micro VC fund with $40 million in capital can make a lot of $50K to $200K investments. I believe the underlying reason for this bifurcation is that the cost of starting a company is close to zero. The cost to get to cash flow positive has also dramatically been reduced.
The need for traditional VCs has decreased and some are going upstream although at smaller overall capital levels. A new entrant, the micro VC, has come in below the traditional VC funding levels. This seems like another Innovators Dilemma situation.