Valve is actually extremely small, I've heard estimates at around 350-400 people.
They're also a flat organization, with all the good and bad that brings, so scaling with contractors is easier than bringing on employees that might want to work on something else instead.
Of course smaller companies exist — there are 1 person companies! But in a world where many tech companies have 50,000+ employees, 300 is much closer to 100 or 10 and they can all be considered small.
And then you consider it in context: a company with huge impact, brand recognition, and revenue (about $50M/employee in 2025). They’ve remained extremely small compared to how big they could grow.
They're also a flat organization, with all the good and bad that brings, so scaling with contractors is easier than bringing on employees that might want to work on something else instead.