Mid-cap and low-cap ETFs and how they grow

I have seen that there are various ETFs that trade mid-cap or only small-cap stocks, and I wonder how it is supposed to grow.

As I understand it, when you do something like the S&P500, those are the largest, so them expanded just means the S&P500 only goes up, but wouldn't a mid-cap stock that does very well move out of mid-caps into large-cap at some point? So the mid and low cap stocks are just constantly full of lower market cap stocks.

Or is the idea that the large cap get so big that people start to flow more money into these smaller ones?

Would mid-cap do well when people lose faith in large companies and seek mid-size?

I feel like i'm missing the “how an index fund based on a small or mid-size range of companies could ever grow as an index”