- Oh boy, okay, so we've been
working on this since August. There's been, I think,
16 interviews in total. Let's see how this goes. So you know Valve, right? The company responsible
for "Half-Life," "Portal," "Left 4 Dead," "Team
Fortress," "Counterstrike," and more recently, all sorts of ambitious
hardware projects as well. But arguably, it's most significant role is that it's the
custodian and the landlord of the largest PC games
marketplace in the world. And because of that fact alone, how it makes decisions
and who gets to make them is worth talking about. So with that in mind,
let me ask you something. How does Valve make decisions
and who does get to make them? Those aren't necessarily the
easiest questions to answer. What you may have heard is
that Valve has no managers, no job titles even. And in fact, if you work there, you alone get to decide
what you'd like to work on. Or to put it another way, there are no bosses because
everybody's the boss. That's the pitch, at least. Quick side note here, there is still a board
of directors at Valve, and two of them are rumoured
to own actual super yachts crewed by about 20 people each. So let's not confuse this with a worker cooperative just yet, okay? But here's another thing you
might know about the company. It's opaque. A Valve interview is a
rare, treasured thing. And when they do happen, they tend to be about
a very specific product or some grand thing about the future of games and technology. And as a result, it's not a company that's typically being challenged on how it treats its staff
or whether that 30% cut it's taking from most games
being sold through Steam is actually a fair deal. If you've watched our
most recent investigation into the third party gambling sites that are plugged firmly into "Counter-Strike: Global Offensive," you'll know we were extremely keen to understand why these operations had been allowed to prosper by Valve over the years despite
all the controversy. Whose job was it to be
on top of this stuff and what kind of decisions
had they been making? We didn't know. And in fact, as we worked on that video, we realised we didn't know much at all about how Valve operated, not really. And so we spent the last
six months doing that work, interviewing 16 former and
current Valve employees about whether or not
this structureless utopia with no bosses and no
bureaucracy truly exists. You're gonna have to forgive me for spoiling the answer upfront here. But in short, for some
people, it does, sort of. I've spoken to employees who
have loved working there, who truly believe in the vision and who describe Valve as a melting pot of some of the brightest
minds in the games industry. But, I've also spoken
to others who've argued that although Valve may have
a flat structure in theory, in reality, the power at
Valve is anything but flat, leading to a workplace culture that two former employees
compared to the "Lord of Flies." - Back off, man. I'm sick of you (horn
honks), and so is my gang. - Hiring, firing and salary negotiations are all handled in an unconventional way, which I'm told has led to
certain personality types and demographics benefiting
much more than others. Now, you might argue that many businesses have fallen foul
of that particular issue, but the thing you need to know about Valve is that even by games industry standards, it has a gigantic diversity problem. This is a company that has
been unwilling or unable to hire people that properly
reflect the world around it despite the best efforts of some who've worked there over the years and who have pushed for change. And so we're gonna talk about the ways in which Valve's structure
and its leadership have ultimately blocked
that change from happening. These problems became even more apparent following the murder of
George Floyd in 2020, leading to a lot of internal
discussion at Valve about race and culminating in a generous payout being made to each employee, allowing them to donate
it as they saw fit. However, as you may have
also noticed at the time, no public statement was made by Valve about Black Lives Matter and it continues to be an employer of largely one demographic. You'll hear more about all of that in the second half of this video. But first, Valve is frankly
unlike any other games company in the world. Let's talk about why. (gentle pensive music) This is Valve's official employee handbook first leaked in 2012, and then officially published
for anybody to read. It is, at least partially,
meant as a recruitment tool, describing Valve as the
best place to work on earth and detailing its
structure, approach to pay, and, of course, how every
desk at Valve has wheels, allowing you to roll
yourself and all your stuff to wherever you'd feel
you'd be most valuable. I think all of this is a
really useful demonstration of how at least in 2012
Valve wanted to be perceived as a company. It's not just a job you'll
have if you work there, it's a fearless adventure in knowing what to do when no one's there telling you what to do. Again, this is meant to
encourage more people to work at Valve, so it wasn't exactly gonna open with: don't work here, the aircon's always
broken on the 14th floor, but there's something almost fanatic about the way in which it's written. So here's what I want to do. I want to go through this handbook some 10 years after it was published and tell you what it got
right and what it got wrong according to the people we've spoken to. To do this, People Make
Games has interviewed former and current employees of Valve under the condition of anonymity, allowing them to speak freely
about their experiences without risking their careers either within Valve or elsewhere. And so when you do hear quotes being read from those interviews, you'll instead be
listening to voice actors that we've hired. Let's start right here. Welcome to Flatland. Now, to quote Valve directly, when you're an entertainment company that spent the last decade
going out of its way to recruit the most
intelligent, innovative, talented people on earth, telling them to sit at a
desk and do what they're told obliterates 99% of their value. 99%, that sounds like quite a lot. Take that, most video games companies. Most company org charts look
something like this, right? You've got a bunch of employees
down at the bottom here all in different departments
doing different things, and they've got their own managers, who've got their own managers, and so on and so forth until
you get right to the very top where a CEO, or someone
with a similar title, leads the company. When anyone higher up makes a decision, that's meant to trickle
down through the ranks and be acted upon by the employees below. Now, Valve claims to be doing
something totally different. Here, people don't have job
titles and nobody's a manager, so instead of your typical hierarchy, it promises a flattened company structure in which employees are meant to be making their own decisions based on what they believe
will benefit the company as a whole. Want to fix that problem that's
aggravating you about Steam or maybe throw around some
ideas for a new "Portal" game, or perhaps you're interested in Steam VR? Well, the pitch here is that
you can do any of those things. Just wheel your desk over
to the relevant team. And if there isn't one, make your own. - [Ex-employee] When I worked there, there was this thing we would tell people when they'd come and talk to the company. We think we're the largest
structuralist company in the world. At least within the games industry, I think that's definitely true. - [Ex-employee] We interviewed
people all the time, and one of the goals was to understand if they could succeed in
that type of environment. Not everyone can. - [Ex-employee] There's
just as much structure as you might find in any
other company of its size. The key difference is that the structure isn't written down in a way
that it becomes immovable. People take on different roles that you would see at
a traditional company, but those roles are temporary. It's not like you define your value over the entire course
of your career there as just a project
manager or whatever it is. You're not just one thing. - Valve can be this extremely
attractive place to work as a result, with this
inherent sense of freedom, a great pay, an onsite gym
filled with personal trainers, company vacations to Hawaii, and the opportunity to work on some of game's most beloved titles, but you need to be the right fit. That's something that came
up time and time again in the interviews that we've had. And if you've watched
our video on classism in the games industry, you know that that term just begs to be unpicked and scrutinised. Here's how the handbook puts it. "If we start adding people to the company who aren't as capable as we are at operating as high powered, self-directed, senior decision makers, then lots of the stuff
discussed in this book will stop working." Whereas one former employee told me he believed there was
even a maximum number of potential Valve employees spread across the globe right now, and that number is perhaps
somewhere around 10,000 people. - [Ex-employee] Maybe that number is off by a factor of two or four, but it's not off by a factor of 10 or 100. - I don't know that I've ever
heard somebody in video games make that kind of claim before. The only 0.000125% of the
world's entire population would have what it takes
to work alongside them. It says something, I think,
about Valve's company culture. It's the kind of thing you might expect a Silicon Valley employee to say, maybe, or I don't know, a Navy Seal? - You still have to come
with the mental preparation that allows you to get through
difficult circumstances. - [Chris] But for the time being, back to how all this works in practise, let's say you work at Valve
and you want to, I don't know, make a game about a quiet lad who runs around smacking
disgusting crabs with his crowbar. Maybe you need an artist and a programmer to help get you started. And if that's the case, you'll usually need to go
out into the rest of Valve and recruit the right people
onto the project yourself. If you're able to convince those people to work on this thing with you instead of whatever it was that they were working
on before, then great. Wheel all your desks
together and get started To begin with, nobody's necessarily leading the project, but let's say at some point you scale up. And instead of three people
working on this, there's 20. Who keeps everyone moving
in the same direction? Because wait a minute, didn't we just say Valve
doesn't do managers? The thing is, bigger projects like this do still need some sort of
organisation to function. They need what Valve
describes as team leads. It's just these roles are
meant to be more fluid than at other companies. - [Ex-employee] It isn't true to say there's no management at Valve, it's just there's no
institutionalised management. There are some people at Valve, I'd say a small number of people, who are a great natural managers. There are also people at Valve
that have that de facto role but aren't necessarily great at it. And that's true at any company. It's just that at Valve, it's sort of a secret who's who, and so when people are bad managers, it can take a very long time
for that to be addressed. Sometimes the way that's addressed is the project goes down in flames and that person doesn't become
a de facto manager again. - Other employees I spoke to
suggested that in most cases, you do actually know who's
leading the bigger projects because it's typically
someone who's been at Valve for a long time. And so although it might not
be written down anywhere, there is in fact a clear
hierarchy in place. But let's think about
some of the other things that managers are
ordinarily responsible for. Hiring, firing, performance reviews, and salary negotiations. You know what, I'm gonna jump
straight to that last one because I think it's really important to understand about Valve. Let's talk about stack ranking. If you've heard of this concept before, it might be in relation to Microsoft, who used its own version of stack ranking to measure the performance
of its employees from some time around
the early 2000s to 2013. By which point, it had become an intensely controversial practise within the company. Valve's co-founders, Gabe
Newell and Mike Harrington were both ex-Microsoft, it's worth pointing out. But it's not a one-for-one comparison. Valve's stack ranking is
very much its own thing. Here's how it works. Typically, a starting salary at Valve has been described to me as
being extremely competitive for a video games gig, but also when compared to the
likes of Amazon and Microsoft, who both have headquarters
close to Valve's own in Bellevue, Washington. And this salary that you start with is then adjusted annually via what's known as the
stack ranking process. Although COVID has
gotten in the way of this in more recent years. In a typical year, however,
from about October onwards, employees are invited into meetings with a handful of other co-workers in which they're asked to evaluate the performance of several
of their other colleagues based on four separate metrics. Skill level, productivity,
group contribution, and product contribution. You can read Valve's own definitions for each of these in
the employee handbook. - [Ex-employee] Mostly
everybody participates in the ranking if they wanna participate. We generally have groups of four to six people in each meeting, and usually they're ranking
10 employees at a time. Those 10 employees being
ranked are generally all people that those in the meeting have
worked with through the year. - Once enough of these
meetings have taken place, everybody at Valve should have been ranked by at least two separate groups, meaning that you end
up with this giant list of every single employee at the company ranked, in order, by how highly
their peers have rated them. Valve then uses that list
to sort all of the employees into different bandings. So here's everyone that's overperforming, here's everyone that met expectations, and here are the folks that
are currently underperforming. - [Ex-employee] They were
somewhat stressful meetings in terms of, you know, ranking people. It's stressful, but I can't think of a single time where I felt like people
were being dishonest or had some kind of agenda or something. We tried to be detached
from any personal feelings and be objective. - [Ex-employee] It was awkward because you had to rank your peers, but actually I think the exercise made sense to the people
coming out of the room. - [Current employee] I think, as
with a lot of things at Valve, it's very easy for the people who work really well inside these systems to brush aside concerns about them because it's true that
for a lot of people, if they have a certain
type of personality, they're probably doing very well. It's not apparent to
them the effect it has on people who have a different
psychological profile or a different level of perceived security within the company. - In January, employees then
receive an automated email from Valve President
Gabe Newell that says, "Hey, this is your new salary, and here's how much you're
getting paid as a bonus." I'm told, more recently at least, that those bonuses have calmed down in favour of higher salaries, but in the past, it wasn't unheard of for that bonus to be the equivalent of your entire salary in one go, if you performed really highly and if the company has had a
particularly profitable year. Alternatively, if you've ranked poorly, then you may find that
you're now getting paid less as a result, although almost everyone I spoke to said that trying to figure out
the exact relationship between your performance that year and these numbers that
you've ended up with is surprisingly tricky. - [Ex-employee] You never
knew what that meant. All you knew was I got a bonus that was really great last year, but then this year it's half as good. Does that mean I did way worse? Does it mean the company
hasn't done as well this year, and so bonuses are lower? - From the conversations I've had, this layer of mystery surrounding pay seems to come from two
separate directions. On one hand, you've got Valve as a company deciding that stack
ranking just works best when they don't then
explain their working out at the end of the process. One former employee
believed that by doing this, it stopped people from trying
to game the system too much. And on the other hand, there's confusion because
Valve employees just don't really talk to each other about their salaries and compare notes. - [Ex-employee] American
culture doesn't like talking about how much we're getting paid. You might talk with some of
your closer friends about like, did you get what you expected? But you'd never really talk about
about the specific numbers. - [Ex-employee] A few of the women did after some of us quit, and then it was more of the case of, "Holy (beeps), they should
definitely have paid you more." - We'll have more to say on gender and diversity issues at the
company later on in this video. Interestingly, any Valve employee can log onto Steam's dashboard and see exactly how much
revenue the company has earned through that marketplace
whenever they like. That can be for a specific game, or region, or just, more generally, how much money did Steam make this year? And a couple of people I spoke to used that as a sort of litmus test for trying to decipher exactly what their pay packet meant and where in the ranking
they might have landed. But all speculation aside,
what everyone knows is this: the opinion of your coworkers has the potential to dramatically affect the way in which you're
being compensated. - [Current employee] I've seen
people who, by their nature, don't give a (beeps) and say, "I'm just gonna work on the things I enjoy and I trust that in the end, if I'm doing good work, it'll be fine." There are also plenty of people who, when faced with the
dynamics of this, think, "Oh God, I better make
sure I'm working on things that are perceived to be valuable." - [Ex-employee] A lot of
people, including myself, did put a lot of weight on
this throughout the year, so decisions that you made
were through the lens of 'how am I going to be
ranked against my peers at the end of the year?' And this did have the
effect of a lot of people making short-term decisions. I don't wanna spend three
years with a (beeps) ranking because I'm working on
some long-term project that may or may not pay off. - [Ex-employee] One of
the most interesting ways you could see it seeping in was when people specifically
did riskier projects near the beginning of the year, and then they'd go back to
the more well known ones as it gets closer to review time, because recency bias would make
people focus on that stuff. - I've heard a number of pros and cons when it comes to Valve's stack ranking. On one hand, there's an argument that it helps incentivize
some of the less enticing work to actually get done. Remember, this is a company that says you get to pick
what you'd like to do. Well, if that's the case, surely there's gonna be some more boring or less jazzy work that
might get left to one side if it weren't for the fact that
by stepping up and doing it, you may then get a bump when it comes to your stack ranking score later down the line. People might say, "Hey, that person was a
team player this year." And alongside that, quite a few of the people
I interviewed believed that it's no bad thing for Valve employees to be prioritising work that is perceived as
valuable to the company because if you're grinding
away on project after project that ultimately ends in disaster, then perhaps you
shouldn't also be entitled to such a large slice of the pie. But here's an important question. What exactly does valuable mean to Valve? Does it mean financial success? That's certainly part of it. If you've helped ship "Half-Life: Alyx," perhaps that's something that
can be partially quantified in terms of sales and revenue targets. That's not gonna be the whole picture, but it's certainly a factor. However, when it comes to
some of this other stuff listed in the handbook's
section on stack ranking, like, how much has your co-worker contributed to studio process, hiring, integrating people into
the team, et cetera, well, suddenly, that's a
different kind of judgement call. What's valuable in this case depends much more on personal taste. Or to put it another way, personal biases. I can't tell you how
many women work at Valve, or people of colour, or non-binary folks, or those who identify as
LGBTQ or disabled people because, well, Valve is a private company and it doesn't need to
disclose those numbers, and also it didn't respond
to our own requests for those figures. However, multiple
interviewees that we spoke to described the company as having an enormous lack of diversity even by games industry standards. Valve is, I'm told, extremely
white and extremely male. - [Ex-employee] I feel like they've passed a critical mark. It used to be that there were maybe 10 or 15% women in the development teams, so nobody was usually the
only woman in the room. But definitely now, I think
they've dipped below that point. - [Current employee] Valve's structure is what makes it difficult
to gain momentum on anything where the value add
isn't immediately obvious to certain people though, and that certainly includes any project where the word "diversity" is mentioned. - [Ex-employee] A lot of
contractors are female, that's not very unusual. The lower down the ladder you go, the more, quote, unquote,
"diverse" it becomes. And the higher up you go, the whiter and male it becomes. While I was there, there was never more than
one female programmer at the company. - It was also pointed out to me that although certain parts of the company are staffed predominantly by
women, like HR and finance, which are much more clearly defined roles, those people, because they're
clearly defined roles, have less freedom to move between projects or change their role entirely
as, say, an engineer might. So what's going on here exactly? What is it about Valve that
makes this problem even worse than at similar sized games companies? Well, let's start here. As Valve states in its own handbook, it's not good at mentoring people nor does Valve have an
internship programme or a college graduate pipeline, and that's by design, because remember, it's ideal
candidate is a high-powered, self-directed, senior decision maker. - [Current employee] By its own admission, Valve only hires senior people. That compounds the issue because part of making
any field more diverse is that you have to start
introducing diversity into it. Valve's not gonna be one of
the places that helps in that because it doesn't hire junior people, which means your pool of diverse hires is even smaller to begin with and it's going to be so much harder to hire someone who is
a woman, or isn't white, or any of the things that isn't your average
Valve employee profile. - There have been efforts
made over the years by various employees
who've pushed to make Valve more representative of
the world around it. However, I'm told these
efforts are largely blocked by either the company's
structure or its leadership. Take stack ranking, for example. To be able to properly judge
the value of someone's work through stack ranking,
you need two things. First of all, you need to have actually
seen them do that work in the first place. And secondly, if you have seen it, you need to understand that work enough to recognise it as something worthwhile. - [Ex-employee] When it comes to this idea of you doing the work that you
think is the most valuable, the people who usually think
the business can improve by having more diverse representation are the people who are not
in the majority already. That work is exhausting and
it is way less measurable. At the end of the day, am I gonna get counted
for doing all this work? Some people say yes,
but I don't know, man. It's not like shipping a game or working on a very
specific shippable feature. If you're tying your performance to how many non-white dudes you hire, that's a dangerous combination. It feels extremely insurmountable. - [Ex-employee] There was never any sort of anti-bias training or even preamble to the
process of ranking people from different backgrounds to you. - [Ex-employee] In the end, it was like, why am I fighting these uphill battles and try and make the tiniest
incremental positive changes when I could be doing better and more satisfying work elsewhere? I think a number of people who have left recently came to a similar conclusion. - Now, Valve is famously picky
about the people it hires. As the handbook lays out, "Hiring well is the most
important thing in the universe. Nothing else comes close. It's more important than breathing." Interestingly, anybody at Valve can be a part of the hiring process, whether they've been there for 20 years or only recently joined. You can sit in on interviews,
speak to candidates, and eventually, have a say on whether or not they
actually end up at the company. One current employee told me they believe that part of what made this such a gauntlet for
potential employees at Valve actually came down to some of
the risks that were involved when you are doing the hiring. - [Current employee] It's much
safer to criticise someone than it is to defend them. This is a dynamic with people in general, but it's just at Valve, so many things work this way and this dynamic comes out more. It's easy to cast doubt on something because you can always seem
more intelligent or discerning if you say, "Hmm, I
don't know about that." Whereas if you speak out on
behalf of something and say, I think this thing is really great, or I think this person is really great, you're opening yourself
up to a much greater risk in terms of how you're perceived
by other people at Valve. Whereas if you said, yeah, I just don't think
this person can cut it, you're really taking zero risk whatsoever. That's a very safe reaction to have. - And, of course, what's
gonna be considered riskier? Hiring someone that looks
like you and sounds like you or hiring someone from a completely different
background altogether. - [Ex-employee] There's
nothing in an overt sinister sense that's discriminatory about the Valve hiring process except in the way that
all hiring processes select for people that are like
the people doing the hiring. However, there are two
compounding problems facing Valve. There's the existing
demographic profile of Valve, but also the hiring process
is so incredibly stringent and so difficult to pass people through, you're even less likely to
get a diverse group of people at the end of it. To get hired at Valve, you basically have to not get vetoed by anybody you've encountered
in the hiring process. And so you're saying the
hole you have to fit through is so incredibly narrow. And there are already more
middle-aged white guys in the games industry than
any other group of people, so those few who make it through are most likely going
to be from that group. - Multiple current and former employees told me they believe this
issue is not being addressed because Valve's leadership
simply does not understand it, despite the best efforts
of those who over the years have really pushed for people to take it more seriously
within the company. - [Ex-employee] It's not
that they're knowingly or explicitly sexist, or racist,
or homophobic, or anything. It's just bias. They think 'why bother doing outreach to some other population when we know the only thing that works is hiring people just like us?' - [Ex-employee] Imagine if
you've been in positions of power since like 2000 and you've never really had
to be accountable to anyone other than your coworkers
that always look like you and think like you pretty much, and you've been extremely
financially successful. You become extremely
conservative and risk averse without understanding
that's what you become. You've constructed all these ways to justify that you're being risk averse, but really you're just
saying the status quo is fine because it's comfortable. - Actually given we just discussed hiring, let's turn our attention to the other end of the spectrum as well. If Valve is a company where
you can choose your own work and there is no real management, how do people actually get fired? What's stopping me, Chris Bratt, from squirrelling myself
away in a corner somewhere playing "Marvel Snap"
for the next two years and calling it competitor analysis? I think we should try
putting Ironman in Artifact. So ideally, I'm told
this process should begin with some of your coworkers around you noticing your performance or that something is wrong and letting you know that ahead of time. If things don't improve, it
might then get flagged during, for example, the stack ranking process with that employee receiving a lower score and the group involved deciding that it's time to have a
more serious conversation. - [Ex-employee] The ones
that I was involved with were the sort of unavoidable end of multiple attempts to
give somebody the feedback that they were failing to live up to the expectations of their peers, and those conversations
are never pleasant. You can never convince someone
you're right to fire them, but you can also make it feel
like it isn't a hatchet job. You'd sit the person down
and give them feedback, this is the problem, but I'm not going to
tell you how to fix it because you are an adult
and that's your job, but I will do my best to help you. I think the challenge in that situation is that you don't have one boss, so you can't come back to me and say, "Am I doing well enough?" You have to look 360 and ask your peers, and many of those peers aren't
going to be completely open to having a candid conversation because there's
complicated human dynamics. - And so, as several
employees have expressed to me, the issues with this setup
can start to show themselves when the people around you avoid having those difficult
conversations altogether, or maybe they do try to have them, but they're unable to properly express what exactly the problem is. - [Ex-employee] A lot of people, even those I'd consider as very valuable people at the company always feel like, "Am I gonna get fired?" People are very insecure at
Valve, which is really weird. I think it's an
organisational design problem. - [Ex-employee] There was
always a fear internally that you could be let go at any time. - [Current employee] You can
see when it's happening because you'll get these
cryptic emails saying, "Hey, everyone, it's my last day at Valve. Loved working with you. Anyway, talk to you later." And then another one will
come out in three hours, and then you realise, "Oh
God, it's one of these days." If you're a certain type of personality, it's very easy to think, "God, I'm in a cutthroat environment where while I'm here I'm paid very well, but at any point, the tap
could suddenly shut off." - But who is the person who
actually does the firing? If things get to that point, who tells you that you're fired? - [Ex-employee] Much like anything else, either someone volunteers because
they felt it was important, or I like to describe Valve as an economy. You earn credit and currency by doing things that
were often unpleasant. That would let you trade to do things that were cooler in the future. If you were one of the people who got asked to leave by somebody who was bad at it, it's terrible. Really, actually terrible. - Again, it's worth saying that plenty of the people I've spoken to have had a fantastic time at Valve and look back on those years
with a huge amount of fondness, but I do think it's worth pointing out that although I've heard the pros and cons for almost every part of Valve's
unique structure or ethos, I don't think I heard
any real positive words about the way in which it
handles firing in particular. Perhaps that's why it's not
mentioned anywhere in here. And I do think all of this contributes to Valve's issues with diversity. There are certain barriers here which are just harder to overcome if you don't fit this mould
that Valve has always had. Now, it's hard to overstate
the financial success that Valve has enjoyed over the years. Again, this is a private company, so we don't have the figures to hand, but multiple employees describe
Steam's enormous revenues as having completely
changed the trajectory of Valve Corporation. I'm told that Valve would almost certainly
have shipped more games, not necessarily better ones, but definitely more, had it adopted a traditional
company structure that doesn't allow employees to walk, or roll, away from projects as easily. But ultimately, Steam's success
has meant Valve's income has not been dependent
on the next game it ships in a very long time. As a result, more than
one employee described landing a job at Valve as like
getting tenure at a university. Valve's business model
and rich war chest of funds makes it a very different kind of employer that has the potential
to allow its employees to do very different things that they may find harder to justify at, say, a publicly listed company or somewhere that's haemorrhaging money between new products being shipped. And so when it comes to taking big, ambitious swings at projects with harder to quantify
returns on investment, Valve has been able to step boldly into the world of virtual reality and hardware manufacturing, but employees say that that same belief, that same trust, isn't also being applied to making Valve a more diverse employer. - [Ex-employee] If it's an issue that the people in power
also understand fully, then they make all
sorts of accommodations. So stuff like parental leave. I think the people in power can understand that having a kid is hard and so we should give
people six months time off, but should we make it
easier for people of colour to join the company? They'll just be like, why? I feel like that's the dividing line. They are really, really good for employees for things they really understand. - Some of this frustrations spilled out into a wider discussion within the company after the murder of
George Floyd in early 2020 as a group of employees within Valve pushed for the company to
make a public statement in support of the Black
Lives Matter movement. - [Current employee] There was a huge amount of internal contention about whether Valve should
say anything about this because there was increasing
pressure on companies to address what was going on. There were people who felt
desperately passionate that Valve needed to do and
say something proactive, and there were also people
who felt incredibly passionate regardless of their own
individual political convictions that Valve should not and must not do so. - I'm told the employees on the Valve should say something side were more united in their reasons
for why that was the case. They'd argue that the company had the opportunity here
to use its influence to stand against the
discrimination of black people both in America and throughout
the rest of the world, and that was a valuable, moral thing to do. And more than that, if Valve were to choose
to remain apolitical here, that would be, in fact, the
company making a political stance and not an impressive one. Some the other side of
the argument disagreed because of their own partisan allegiances, although I'm told that was a
relatively rare stance to take. More common were the beliefs that Valve as a video games company had no business getting involved in something like this at all. Or alternatively, others asked if Valve did choose
to say something about BLM, where would be the cutoff point? Would Valve also make similar statements about other discrimination and atrocities happening around the world? If so, which ones and why not the others? Better not to say anything at all. In the end, no public
statement was released and several employees I've spoken to blame Valve's leadership
outright for that decision. Although employees from across the company had very strong feelings
about what should happen, they claim that Valve's most
senior names dug their heels in and stopped any real
momentum from being built. - [Ex-employee] They had
a lot of conversations and then decided that as a company, they're not going to say anything. And that's how Valve rolls, they don't feel that they
have to say anything. Whether it's a trend or a moral compass. I think a lot of it comes
from Gabe Newell directly. - However, I've also been told that the larger hurdle to overcome was, in fact, Valve's structure, its lack of managers and clear hierarchy. Even after months of discussion, it was difficult to
land on any one message that everybody at the
company could agree to. Who should write it, where should it be published, and what kind of commitments
should actually be made? These questions bounced around for weeks with no true consensus ever being reached. And eventually, the whole idea of a public statement was replaced with an internal one, sent to
all Valve staff via email. And with it, money. - [Current employee] Ultimately,
the thing that was landed on was that Valve would give
every employee $10,000 to do with whatever
philanthropic desire they have. - [Ex-employee] Every employee could choose when and how to donate that money,
to the charity of their choice. There were no strings attached, so, of course, it wasn't
required that it was donated. - There are a few different ways of looking at that transaction, I think. If I'm being generous, I'd say that Valve coughing up, what, nearly $4 million in this moment, allowing their employees
to spread that to charities that they think are worthwhile will have made a tangible
difference to the world. And perhaps if there's no consensus on what charities should be
supported by Valve itself, allowing employees to make
that decision personally is at least a compromise and does result in something
happening, and quickly too, rather than further weeks
and months of debate. However, if I'm being less generous, I'd ask if that was simply seen as the acceptable price
to pay to stay silent by a company's leadership whose lives are about as far removed from people like George
Floyd and Breonna Taylor as you can possibly get. Also, the no strings attached thing is somewhat uncomfortable to think about. It would've allowed for somebody at Valve who did not believe in Black Lives Matter and what it represented
to have received $10,000 as the direct result of a
black man being murdered by the police, and then instead of donating that money, they could have kept it for themselves? Or if they did donate it, to pick a group that opposes BLM's goals. I don't know if that's happened here, but the opportunity was certainly there. Around this time, there was also increasing
pressure being applied on Valve to say something from outside
of the company as well, with multiple indie
developers pulling their games from Steam outright in
protest of Valve silence. As this pushback began
to build some momentum, it was then announced that Valve would be sponsoring that year's
Game Devs of Colour Expo, as well as an upcoming Black
Voices in Gaming event. Although, and I think this
is important to recognise, this announcement came via
one of the events organisers and not through Valve itself. In fact, according to gamesindustry.biz, the most Valve was willing to say was Sean's tweet is accurate. That was it. Four words. Now, these sponsorships were undeniably a positive thing for GDoC
and Black Voices in Gaming. And if you're a part of those events, you'll have been able to see
that Valve did support them, which is great, but you've gotta imagine that the vast majority of Valve's audience never clocked that this even happened, which means you end up with a situation where a Valve fan who literally
hates the BLM movement is unlikely to be upset
about what's happened because they won't even know about it. What's that expression? Put your money where your mouth is? Valve's critics may well
argue that for this company, it's the other way around. Multiple employees have referred to Valve's board of directors, and in particular, it's co-founder
and president Gabe Newell as having strong libertarian ideals, meaning that in their eyes, Valve simply isn't meant to get involved in moments like this. It's a video games company,
not a political party. But as we've heard, it's also a video games company
with a diversity crisis. And I'm gonna go out on a limb here and say those two things
are probably connected. This desire for political
neutrality has also come into play when Valve has needed to make decisions about what can and can't be sold on Steam. In mid-2017, Valve
introduced Steam Direct, allowing game developers big and small to get their game onto the marketplace as long as they paid an upfront $100 fee. It was a significant opening of the doors for this storefront, which had previously relied on users voting for the games they wanted to see, and those games slowly being
approved by Valve themselves. This change in tact inevitably came with its own controversies. One game almost made it to release, which would've had players taking control of a school shooter until Valve pulled it from
the platform a week or so before it would've launched. And there's also quite a lot of confusion over what exactly was considered
too pornographic for Steam. These days, if you literally
search the word porn on the storefront... Whoa, that is not what I... That's not what I meant to get. Jeez, you receive just shy of 500 results, and that's not that much different than searching the word mech or football. Valve must be one of the biggest players when it comes to selling
video games about sex, and so some kind of clear
policy was going to be needed. There was a group meeting
at the time at Valve every few weeks or so to filter through the
games that been flagged as potentially inappropriate
for the platform, and then they'd make a decision
on a case by case basis about what should be allowed
through and eventually be sold. - [Ex-employee] If I recall, Gabe invited himself to
one of those meetings and started making statements about how we should not restrict anything that is not illegal. Something that Gabe would
like to say is that if we were a video store, he wouldn't want to carry "The Sopranos" if it was up to his personal taste, but he recognises that that's
an extremely successful and popular television show. And so even though he felt
like it had no societal value, it's not something that should be banned. We would argue that there's a difference between us thinking something
has little societal value and us thinking it has
negative societal value. - If you've been on Twitter at
all over the last few months, you'll have also seen the world's most irritating billionaire argue that social media content should only be banned if it's illegal. Although just like with Steam, it's difficult to know exactly how that's meant to work in practise for a platform that spans
so many different countries and cultures and legislative bodies. But even if you were able to navigate that particular pickle, you're still left with this question: should Steam as the
largest digital marketplace for PC games in the world also protect its players from content that may well be legal, but
could still be harmful? - [Ex-employee] One of
Gabe's arguments was that these games will make a bigger
splash if we say no to them, rather than if we say yes
and then nobody buys them. But that didn't really sit well with me. I think it's appropriate for companies to take moral and ethical stands, but management did not agree with that. - And so again, Valve
ended up in a situation where its employees
disagreed on what exactly the company's role in
society was meant to be. And just like with the
more recent BLM example, several employees have told me that, ultimately, it
was Valve's leadership that made the final call. - [Ex-employee] That
was a decision that was, I wouldn't say unilaterally made by Gabe, but it's basically his
libertarian political beliefs directing the flow of the company in a way that a number of the
employees did not agree with. There were several more meetings over the next couple of months, and then word got around that
a statement was being drafted. - This statement published in 2018 is still up for you to
read today with the title, "Who Gets To Be On The Steam Store?" And if we scroll down just a
smidge, here's your answer. "We've decided that the right approach is to allow everything
onto the Steam Store except for the things
that we decide are illegal or straight up trolling. Now, that's interesting language, I think. What does straight up
trolling really mean? Here's what I think it might mean. Valve wanted to avoid
the extremely difficult and unavoidably political act of stating, "Hey, this is exactly what's
not allowed on our platform because we don't want it." - [Ex-employee] I disagreed with this free speech absolutist stance, but also that our team was railroaded into adopting the stance as well. It really left a sour taste in my mouth. - And all of this means that in 2022, you can find games like
"Prison" on Valve's storefront, which its own developer describes as, "In this great game, you have to plunge into
the story of a girl who against her will ended up in a women's prison." "In this game, a very strict warden who loved to (beeps) other
girls is waiting for her. Our heroine will not be an exception. The warden will rape her just
as hard as the other girls." Not exactly the bloody
"Sopranos," is it Gabe? You've also got games
like "Tyrone Versus Cops," which I'm reluctant to
include in this video at all because I'm sure it'll delight
the (beeps) who made it. But I do think it's worth highlighting that this racist, caricature crap is allowed on Steam with
its hundreds of gleeful, equally racist community
posts and reviews, while at the same time, Valve chose silence when it
came to Black Lives Matter. That's not apolitical. There's actually a Resetera thread from back in February of this year where folks were talking
about this particular game and venting their frustration at Valve for doing nothing about it. I counted 11 users who
replied to that thread suggesting they'd reported
it as racist content, and I'd imagine many more
did so without leaving a reply, and yet the game remains
up for sale to this day. And that tells us one of two things. Either Valve's moderation
team never read those reports, or they did, and somebody at Valve checked that game against the
company's watertight policy of not illegal or straight up trolling and decided to give it the big thumbs up. Now, one of the reasons
it's worth talking about what happened with BLM or
Steam's policy decisions in 2018 is that it challenges this idea that Valve is truly a
structureless company, or as it says here, a fearless adventure in knowing what to do when no one's there
telling you what to do. Clearly, this is a company that operates differently to most, but when it comes to
big political decisions, whether that's to do with
diversity initiatives or speaking out about police brutality against black Americans, or deciding what can and can't be sold on the biggest PC platform there is, the hierarchy does seem to reveal itself. The handbook jokes that of
all the people at this company who aren't your boss, Gabe
is the most not your boss. And I just don't really
believe that to be true. More than that, I think
all of this contributes to an image of Valve
that isn't always helpful and that can ultimately
make it less accountable. We contacted Valve ahead
of publishing this video with a list of questions based on some of the issues
we were gonna raise here, issues that had come from their employees. We heard nothing back. We contacted them last month
about the video we published in which we investigated
the "CS:GO" gambling sites after hearing from players who had developed gambling addictions, having found those sites
when they were teenagers. We heard nothing back. When I worked at Eurogamer, we'd contact them from time to time about stories we were working on or things they should probably comment on, and it was almost a running
joke within the editorial team that you just didn't know
if you'd hear anything back. You were basically rolling a dice, and perhaps that'd be more palatable if this was only a game studio that made "Half-Life" and "Portal" and "Team Fortress 2," but it's not. Valve has something close to a monopoly on PC gaming in most
countries, thanks to Steam. And so maybe this air
of mystery and mystique around its decision making
isn't exactly what we want from a company with that kind of reach. I imagine Netflix at least
return your calls, probably. when asked by a GDC survey in 2021, only 3% of developers believe
that 30% was a fair cut for companies like Valve to be taking from the game sold on their marketplaces, and yet for all but the
biggest names on Steam, that's exactly what the company demands as its share from each game sold. That's a decision that ought
to be challenged, right? But when was the last
time you heard Gabe Newell or someone senior at Valve get asked about that by
someone in the press? You didn't because those
people rarely do interviews. And when they do, it's
very much on their terms. And I think we've all sort of accepted that this is the case in a
way that we perhaps wouldn't for other companies. Valve seems so separate
to EA or Ubisoft or Xbox. It hasn't got the corporate veneer that those companies might have. And then perhaps also, there's a part of us that has a different
relationship with Valve because of its games that can distract us from what is the much, much, much more significant
portion of the business, at least in terms of
revenue, which is Steam. Valve is Steam, and Steam is this pillar
at the very centre of the games industry. If you change the shape of that pillar, everything around it begins
to reconstruct itself as well. Let's say, for example,
that Valve did reduce the cut it takes on Steam. Well, that wealth then spreads throughout the rest of the industry. It could mean that, for a start, more independent developers are able to pursue that work full-time, others would get a significant pay rise or maybe have extra funds to
dedicate to their next project. Or if Valve were to take a
harder stance on discrimination, whether through recognising
its own failings as an employer or through its policy decisions on Steam, the culture of video games might just shift with that
decision, even by a little. I don't know, maybe I'm just
frustrated that once again, we won't hear back directly from Valve about any of the issues
we wanna talk about. And, yeah, hence the soapbox
at the end of this video. If you happen to be someone
senior from Valve Corporation, if you're Gabe Newell
and you're watching this, feeling at all misrepresented by anything that we've
said here, get in touch. We would love to talk. Our job is better when we actually get
to interview the people that we're reporting on. And, yeah, so pick a day, any day. We will jump on a plane, come to Bellevue, and put some of this
stuff to you directly. Back to the handbook
for just one more thing. Here on page three, underneath
Valve Facts That Matter, it states that Valve is
more than a game company, and that's absolutely true. It's instead a company that tens of thousands
of game companies rely on in order to sell their games and keep the lights switched on. And so, and maybe this is a little out there, 'when's "Half-Life" three
coming out, lol?' may no longer be the
most pressing question we need to ask them. Thanks for watching. Final, final note here. As you know, Valve didn't
reply to our email. However, about 10 hours after I sent it, I was greeted by an extremely interesting LinkedIn notification. So, I suppose someone read it at least. All right, I'm gonna keep this brief because that was a big ol' video. We simply could not do this kind of work without your support over on Patreon. People Make Games patrons gain access to our Discord community,
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