[eru]

A larger applicant pool, AND because they are a commitment device.

As a candidate, I know that the company is burning roughly the same amount of engineering hours interviewing me as I am burning interviewing them. So it's an honest signal that they are at least somewhat serious.

For comparison, one problem with take-home exercises as a first step, is that (especially good) candidates will wonder whether it's really worth their time when their work might just go into the round file straight away.