It's not that they didn't see value in it. Augmented reality and virtual reality are two different things. Valve believes that AR technology will be harder to develop than VR, and consequently that VR will become feasible and popular before AR. They chose to go after VR first, postponing AR for later. Jeri Ellsworth didn't want to wait, so Valve let her leave and take all the IP with her to try AR on her own.