It turns out that Gabe can be a pretty honest guy. In this interview with Polygon, he goes into detail about the shortcomings of VR and admits that his company is totally prepared for the possibility of virtual reality failing to take off. Interestingly, he even says that the HTC Vive is "barely capable of doing a marginally adequate job of delivering a VR experience." Gabe seems to think that the major detractor is price, although he is optimistic and suggests that VR will, at least, succeed purely as a display technology.
"Some people have got attention by going out and saying there'll be millions of [VR unit sales] and we're like, wow, I don't think so. I can't point to a single piece of content that would cause millions of people to justify changing their home computing. It's a great thing for enthusiasts and hardcore people. Where we are today is way further down the road than we were a year ago. But it's just going to be this slow, painful fits and starts kind of thing. So while we are really happy with how things are going, yeah, it doesn't match up with what other companies are saying."