Now, I don't know for sure if that's hyperbole or not, but that's the impression I'm getting from talking to hiring managers.
I interviewed with google last month. I met like ~20 people who were also interviewing at google at the hotel breakfast. Some of them said they have been prepping for the interview everyday for past 4 months ( didn't help with my confidence :)).
Reception at google was filled with 100s of people waiting for their turn to be picked up. And this was just one building among of many, many buildings. Lady at the reception at Avis car rental told me that they get 100's of people coming everyday for interview at google. It was bizzare and surreal to experience 'interview industrial complex' first hand.
All they've managed to bring forth with their epic hiring process (now the de-facto gold standard, worldwide) is an epic... arms race. The higher they set their "bar", the more desperately people will cram their heads full of Boyer-Moore, A*, and countless other algorithms they (and their interviewers) couldn't otherwise begin to care about.
Other than Avis, Airbnb, and the local hotels, it's hard to imagine who could realistically benefit from such theater.
[1] https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...
Their main problem is that their hr specialist take a long time to train, and since stationed in good startups they might want to become a FullTime employee themselves, instead of switching to a new startup as the existing one grows too big.
If I can come up with a reliable, repeatable system for identifying good developers, I still have to convince other companies to pay for it. The skepticism I get from companies is off the charts.
Do you know how the "HR as a service" company gets around that? Maybe that's why they embed their employees in the startup (face time generates trust)? I don't see them lasting long, though, for the exact reason you state: they're setting themselves up for high training costs and high turnover.