A lot of the time in the industry, developers are using money loaned by publishers. Things like getting more development time, which means asking for more money is a negotiation that the devs aren’t guaranteed to win.

Valve is one of the successful developer & publisher companies that managed to survive. The 90s were a much smaller time for video games, and a small startup like Valve could compete with the big names out there. They had more freedom in a sense, but they also were taking quite a gamble. Other companies tried the same and didn’t survive.

It’s easy to simply say “only release a game when it’s 100% done” but it’s a lot harder when you’re watching money that keeps your company afloat dwindle with each delay. Also, “100% done” is a very flexible concept. Games almost always have to cut content or make concessions in some way, so figuring out what a done version looks like while working on it can be difficult.

The modern version of a small Valve style startup would be something like a Kickstarter funded development. Again, unless you are (for some reason) a Star Citizen dev, people are going to stop giving you money and you have limited funds and thus limited development time.

And just because you delay to try and release a superior game doesn’t mean it will be a smash hit.