The issue comes down to how the device interacts with your computer. Just like the original version, the new Steam Controller has no native Windows drivers. This means the hardware relies entirely on the Steam app to function properly. If you do not have the game running via Valve’s storefront app, your shiny new gamepad turns into a useless piece of plastic.
Gamers Nexus also reported this and there are a lot of other news outlets also covering this. It is kinda the same as with the steam deck where I noticed that the inputs just don’t work until steam is launched. I really don’t like that I have to have Steam running for this controller to work. I don’t know if it is a dealbreaker for me, yet, but it really put a damper on my enthusiasm about it
The controller requires some sort of drivers to get out of lizard mode and work as a general controller (with remapping and everything). This has been known as it acts identically to Steam Deck and the OG Steam Controller.
If you want to use the controller without Steam being used (which, it’s worth noting, you can add non-steam games to Steam to use the controller, or adjust the default desktop profile to be a normal controller), then you should be able to use SISR (formerly GloSC and GloSI): https://github.com/Alia5/SISR
Or, on Linux, use sc-controller: https://github.com/C0rn3j/sc-controller
Lizard mode?