In the startups I've been part of, we simply test them, and look at their portfolios (GitHub). They've been pleased to hire competent dropouts, and generally don't emphasize some BS grade. (And once in the company, people get a deeper idea of their skills.)
[Edit: after reading _delirium's correction below, I made a couple small changes. I've got a cold, and I'm afraid I haven't made my point well.]
I'm perfectly fine if students aren't graded (or if grades are a strictly private matter between the student and teacher). Many teachers think so too, so-called "radical" teachers, but of course they unfortunately have bosses... a few teachers get away with it, particularly in more democratic schools where students are more in control, but not enough do.
Personally, I learn all sorts of subjects, and the notion of someone conventionally grading me... would degrade the whole experience.
I haven't seen the first part be true, perhaps outside of startups. Companies like Google and Microsoft definitely look at degrees and GPAs. It's not the only thing taken into account, but whether your GPA is 1.8 or 4.0 will definitely impact your chance of getting an interview. Even more so at more BigCorp engineering places like Lockheed or Aerospace Corp.
In fact that's mostly why the "radical" teachers' bosses force them to give grades; UC Santa Cruz's 1950s-80s experiment in giving narrative evaluations instead of grades was mostly ended because employers demanded grades. If it hadn't been for outside pressure on the administration, mainly from employers and students worried about employment prospects, much of the faculty would've liked to continue the previous approach (though support was less strong among engineers and computer scientists, who for various reasons were more in favor of a letter-grading model, and saw the narrative-evaluation model as too "soft").
Ah excuse me, you're absolutely right — I have a strange blindspot where I think that startups I've been part of are "the software industry". (I have a cold right now, and maybe thinking too foggily to post my views. Thanks for the correction.)
[Edit: after reading _delirium's correction below, I made a couple small changes. I've got a cold, and I'm afraid I haven't made my point well.]
I'm perfectly fine if students aren't graded (or if grades are a strictly private matter between the student and teacher). Many teachers think so too, so-called "radical" teachers, but of course they unfortunately have bosses... a few teachers get away with it, particularly in more democratic schools where students are more in control, but not enough do.
Personally, I learn all sorts of subjects, and the notion of someone conventionally grading me... would degrade the whole experience.