Valve structure, employment numbers, revenue revealed in lawsuit

In a stunning revelation, data from an antitrust lawsuit against Valve Corporation, filed by Wolfire Games, the developer behind Humble Bundle, has shed light on the inner workings of the gaming giant. The lawsuit alleges that Steam, Valve’s digital distribution platform, holds a monopoly on PC gaming. However, the most intriguing aspect of the leak is the improperly redacted data that has surfaced, offering a rare glimpse into Valve’s employee count, pay scales, gross margins, and commissions.

In 2021, Valve reportedly employed 336 people, with a mere 79 dedicated to Steam, despite the platform’s release of over 10,000 games that year. This starkly contrasts with Valve’s estimated annual revenue from Steam, which stands at an impressive $8.5 billion. The largest team within Valve, comprising nearly 200 employees, remains focused on game development, while the hardware division, recorded at 41 employees in 2021, has likely grown substantially following the success of the Steam Deck.

Analysis of Valve’s structure and revenue

Interestingly, the average salary for a Valve employee in 2021 was an astounding $1.3 million. Valve’s revenue per employee is estimated to be around $19 million, potentially making it one of the highest revenue per employee companies globally. For comparison, highly profitable companies like Apple and Google generate significantly lower revenue per employee.

Valve’s unique work culture surely contributes to its extraordinary success. Upptic’s own CGO, Warren Woodward, was able to provide some details on how the company looks from the inside – noting an innovative and flexible working environment, amenities such as on-site masseuses and personal trainers, and a custom-order restaurant. Employees also enjoy the freedom to choose their workspaces and collaborate fluidly on projects, a stark departure from traditional office setups.

The benefits of Valve being private

Being a private company, Valve benefits from the ability to focus on long-term projects without the pressure of short-term revenue growth, a luxury not afforded to publicly traded companies. This freedom allows Valve to pursue ambitious initiatives, resulting in unparalleled efficiency and profitability.

Valve’s profitability is not only remarkable within the gaming industry but also on a global scale – other companies we analyzed didn’t even come close to Valve’s revenue per employee (even hedge funds).

The power of Valve’s Steam

Despite the monopoly allegations, Steam remains a dominant force in PC gaming. Its 30% commission fee is comparable to those of Apple and Google, though it offers more incremental value than either through its powerful recommendation engine, which can greatly impact a game’s success. The emergence of competitors like the Epic Games Store, which charges a lower 12.5% fee, promises to challenge Steam’s dominance and potentially reduce its margins.

Valve’s ability to maintain a lean workforce while generating substantial revenue per employee is a testament to its strategic focus and innovative work culture. This unique combination of profitability and work culture positions Valve as a standout company in the tech and gaming sectors.