SV companies are heavily loaded up with engineers that passed leetcode style tests. Not everyone though, due to acquisitions - engineers get grandfathered in. Leetcode coders implicitly will bias to hire other leetcode coders. There will be non-SWE departments, Program Managers etc. who might be hired via the MBA-tribe. So in the end, you end up with a mix of skills (or a mix of stereotypes) in a typical SV company. I think if it were strictly just leetcoder types the company would be a disaster (but I have no data or examples - I am interested to hear about if other folks know examples).

This model of operation feels kooky but it does work on various levels (but fails in some also e.g. as panglossian fantasies ). The overall hodgepodge results in SV dominance we see today in many sectors.

Leetcode is self-fulfilling now. It's like a ticket on to the prestige and mega-bucks ride a lot of engineers desire. People pay for the ticket with 3-4 months study. Those that cannot make the time, say due to family circumstances, are actually part of the implicit unfair bias in the system.

I think what works best is when Leetcode is part of the gauntlet but not the whole game. A genuinely good person, in terms of character, together with good programming skills is what I've seen as a company's best asset. An open ended technical focussed discussion on specifically what the engineer has done lifts the lid on that part of things.