Because of convection mostly.

The fire mostly happens in the bed, the bottom and you add new fuel on top of the hot burning coals.

The heat radiated from the fire bed causes the new fuel to break down (pyrolysis) into flammable gases, vapours and solid particles.

However, hot air rises, so the air flow goes upwards, through the bed of the fire. The excess air and combustion products go upwards, through the as-yet unburnt fresh fuel, and it carries away some of the combustible gases, vapours & particles upwards, away from the fire bed. It doesn't get burned and that's the soot.

Look up downdraught gasifier stoves and secondary combustion.