Tier 1 is default alive and thriving. They don't need the smartest people. They need people who do not screw up. Someone who's willing to spend 3-6 months cramming interview questions is also someone who is unlikely to drop the ball.

Startups are the opposite. They are default dead. If they hire good enough people, they die. They need exceptional, hungry people. The kind of people who abhor busywork. Startups will pull much lower quality on average and paying higher rates drastically increases the odds of death. So their hope is to get lucky on an exceptional junior. They're also more willing to fire fast instead of doing some odd layoff down the line.

Basically Tier 1 will bias towards minimal false positives, and startups will bias towards minimal false negatives. Most companies are somewhere in the middle, default dead in 30 years or so.

Tier 1 also has a huge funnel and they hire lots of people so they need it. A lot of junk gets into the funnel because of the sheer size of it. They need that 1 out of 300, so they just layer enough filters to hit that rate.

Tier 2 companies who need to filter 1 out of 50 should not be adopting Tier 1 practices. Startups probably have like 10 applicants and 6 of them can't do FizzBuzz. But they still need to filter, even if sometimes they end up with 0.