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After his expulsion from Harvard University, Newell spent thirteen years at Microsoft, becoming ultimately a millionaire. Newell calls himself "the producer of the first three releases of Windows". Inspired by the work of Michael Abrash, who previously left Microsoft to create computer games Quake id Software, Newell with another Microsoft employee — Mike Harrington, left Microsoft and set up a Studio Valve in 1996.
Newell, along with Harrington used his personal capital to Finance Valve and the subsequent development of the game Half-Life. For these purposes was purchased the source code of the engine, Quake engine, which was later extensively revised. In 1998, he published a series of games of Half-Life, which became the basis for such popular games and modifications like Counter-Strike and Team Fortress Classic. Shortly after the release of Half-Life, the company began development of the second part of the game. Harrington left the company in 2000, after Newell bought out his share.
Newell suffered from Fuchs dystrophy, a congenital disease that destroys the cornea of the eye, and at some point his eyes fell to a critical level, but two surgeries cornea transplant gave him back his sight. "I just got to see you again, I began to see better than ever. If I were in a fairy tale. Then it dawned on me how quickly the future is coming," recalls Newell.
