Leave Luck to Heaven: The Wild, Weird, and Wonderful History of Nintendo
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Introduction: Before the Mushroom Kingdom, There Were Gambling Dens
Picture a child, eyes wide with wonder, tending to their island paradise in Animal Crossing: New Horizons on a sleek Nintendo Switch. It’s a wholesome, family-friendly image that has defined Nintendo for generations. Now, erase that image. Replace it with a smoky, dimly lit room in 1889 Kyoto. The air is thick with tension. Members of the Yakuza, Japan’s notorious organized crime syndicates, slap down small, beautifully illustrated cards, their fortunes rising and falling with each play. The cards they’re using, the very tools of their illicit trade, were handmade by a small, ambitious company called Nintendo.
The journey from that gambling den to your living room is not the clean, linear success story one might imagine. It is a chaotic, century-plus saga of corporate identity crises, bizarre failures, accidental genius, and a stubborn, almost belligerent, refusal to play by anyone else’s rules. To understand Nintendo is to understand a company that tried its hand at instant rice, taxi services, and (allegedly) love hotels before it ever programmed a single pixel. It’s a company that was saved from bankruptcy not by a visionary business plan, but by a plastic extendable arm invented by a bored maintenance man. This is the story of how a house of cards was rebuilt, time and again, into a digital empire, revealing that the company’s greatest secret isn’t how to make a video game, but how to survive its own strangest impulses.
Part I: The House of Cards (1889 – 1960s)
The Founder and the Flower Cards
On September 23, 1889—a year when the Eiffel Tower was brand new and Jack the Ripper was still a recent, terrifying memory—a craftsman named Fusajiro Yamauchi founded a small business in Kyoto called Nintendo Koppai. His product was hanafuda, or "flower cards". These were not just any playing cards; they were a clever solution to a national problem. Portuguese traders had introduced Western-style playing cards to Japan in the 16th century, but by 1633, the shogunate had banned them along with most other foreign influences, largely due to their association with gambling.
This kicked off a centuries-long cat-and-mouse game. Every time a new card game became too popular for gambling, the government would ban it, forcing the creation of new, more abstract designs to fly under the radar. Hanafuda were the brilliant culmination of this evolution. Instead of numbers and suits, they featured intricate illustrations of flowers and plants corresponding to the 12 months of the year: pine for January, plum blossoms for February, and iconic cherry blossoms for March. Because they were technically educational and artistic, they were tolerated by authorities, even though their primary use was for gambling.
Yamauchi saw an opportunity. While other manufacturers were wary of the criminal element associated with card dens, Yamauchi leaned in, producing high-quality, handmade cards from the bark of mulberry trees. His business thrived, becoming the go-to supplier for the Yakuza-run gambling parlors that dotted Kyoto and Osaka. From its very inception, Nintendo’s business model was built on creatively navigating regulatory loopholes—a trait that would prove invaluable nearly a century later.
What's in a Name? The Nintendo Naming Mystery
Just as its early business practices were shrouded in the haze of illicit activity, the very name "Nintendo" (任天堂) is a historical enigma. To this day, no one, not even Yamauchi's own descendants, can say for certain what it was intended to mean. This ambiguity itself tells a story about a company that, for its first 70 years, had no clear identity.
The most widely accepted translation is the poetic "Leave luck to heaven". This interpretation fits perfectly with a company whose products were tools for games of chance. It evokes a sense of fate and fortune, the very essence of the gambler's creed.
A second, less common theory suggests it means "the temple of free hanafuda". But a third, more tantalizing possibility points to a clever bit of underworld slang. The middle character, ten (天), is the same one used in the word Tengu (天狗), a long-nosed mythical goblin from Japanese folklore. In the gambling dens of the time, the word for "nose" (hana) was a homophone for "flower" (hana). Gamblers looking for a game would discreetly rub their noses as a secret sign. Nintendo even produced a cheaper, mass-market line of cards called Tengu cards, seemingly winking at its core clientele. The name could therefore have been a coded message: "the place that sells the cards you know you want."
Whether it was a poetic philosophy, a simple descriptor, or a shady marketing ploy, the mystery of the name perfectly encapsulates Nintendo's early years: a company of unknown purpose, leaving its own fate to the heavens.
Part II: The Wilderness Years (1960s – 1970s)
An Identity Crisis of Instant Rice and Love Hotels
After Fusajiro's grandson, Hiroshi Yamauchi, took the helm, he realized the company's future couldn't rely solely on playing cards. A trip to the United States to meet with the U.S. Playing Card Company, the industry's largest player, left him underwhelmed; the business had a low ceiling. In 1963, he officially changed the company's name from Nintendo Playing Card Co., Ltd. to simply Nintendo Co., Ltd., signaling a dramatic and chaotic pivot into... well, anything and everything.
What followed was a period of corporate flailing so absurd it borders on performance art. Nintendo threw itself into a series of ventures, each one a more spectacular failure than the last. They started a taxi company called Daiya, which was briefly successful before disputes with labor unions over wages made it unprofitable. They tried to enter the food market with a line of instant rice; it was a complete disaster for the simple reason that it tasted awful. They even tried manufacturing vacuum cleaners, a venture that, fittingly, failed to suck up any market share.
The most infamous of these ventures is the legend of the Nintendo-owned love hotels. These establishments, popular in 1960s Japan, rented rooms by the hour for romantic trysts. Rumors persist that Hiroshi Yamauchi, said to be a frequent patron of such places himself, saw a business opportunity and opened a chain. The story gets even seedier, with some accounts claiming the Yakuza took an interest, hoping to run prostitution rings from the premises. However, modern research suggests this is likely just a tantalizing urban legend. Unlike the well-documented taxi and rice businesses, there is no mention of love hotels in Nintendo's public financial records from the era. The story appears to have originated in David Sheff's 1993 book Game Over and lacks corroborating evidence. True or not, the fact that the legend exists at all speaks volumes about the company's desperate, anything-goes approach during this period.
| Venture | Outcome | Humorous Reason for Failure |
|---|---|---|
| Taxi Service | Abandoned | Drivers wanted to be paid a living wage. The nerve! |
| Instant Rice | Failed | Tasted like disappointment and cardboard. |
| Love Hotels | Likely an Urban Legend | Too busy making family-friendly games (wink, wink). |
This string of failures was, paradoxically, essential for Nintendo's survival. A stable, successful company would never have been desperate enough for what came next. The chaos of the "Wilderness Years" created a vacuum, and into that vacuum stepped a janitor with an idea.
Salvation by a Plastic Arm: The Gospel of Gunpei Yokoi
With the company bleeding money and its stock price in freefall, salvation came from the factory floor. One day, while touring one of his hanafuda plants, Hiroshi Yamauchi noticed a maintenance engineer, Gunpei Yokoi, fiddling with a contraption he had built in his spare time to alleviate boredom: a simple, extendable plastic arm with a gripping claw at the end. Intrigued, Yamauchi ordered Yokoi to turn his homemade toy into a commercial product for the Christmas season.
The result was the Ultra Hand. Released in 1966, it was an instant, massive success, selling over 1.2 million units and single-handedly pulling Nintendo back from the brink of financial collapse. Yokoi was immediately promoted from maintenance man to head of a new games and toys department. He went on to create a series of other hit toys, including the "Love Tester," a novelty device that claimed to measure a couple's romantic compatibility.
More important than any single toy was the design philosophy Yokoi developed, a principle that would become the secret DNA of Nintendo's greatest triumphs for the next half-century: "Lateral Thinking with Withered Technology" (枯れた技術の水平思考, Kareta Gijutsu no Suihei Shikō). The philosophy is simple but profound: instead of chasing expensive, cutting-edge, and unreliable new technology, one should use cheap, mature, and well-understood technology ("withered" or "seasoned") in new and creative ways ("lateral thinking"). The Ultra Hand was just plastic and springs. Later, the Game & Watch would be built from cheap, mass-produced calculator screens. This philosophy is the Rosetta Stone for understanding Nintendo; it explains why their consoles are often less powerful than the competition but almost always more innovative. It was a lesson learned from failure and forged by a humble engineer who just wanted to build a better grabbing claw.
Part III: The Arcade Age and the Birth of Legends (1970s – 1985)
From Light Guns to a Gorilla
Armed with Yokoi's philosophy, Nintendo cautiously waded into the burgeoning world of electronics. Their first forays were electromechanical toys like the Kousenjuu light gun series in 1970 and large-scale arcade installations like the Laser Clay Shooting System in 1973, which were set up in abandoned bowling alleys. In 1977, they released their first home video game console in Japan, the Color TV-Game, a series of simple Pong variations that sold surprisingly well.
Their ambition grew, and in 1980, they made a major push into the lucrative American arcade market with a game called Radar Scope. It was a modest hit in Japan, and Nintendo, confident of success, shipped 3,000 cabinets to its fledgling American division, headed by Yamauchi's son-in-law, Minoru Arakawa. By the time the machines arrived, the American arcade scene had moved on. The game flopped, leaving Nintendo of America with a warehouse full of expensive, useless cabinets and on the verge of financial ruin.
In a desperate Hail Mary, Yamauchi turned to a young staff artist who had designed the casing for the Color TV-Game consoles: Shigeru Miyamoto. Miyamoto, who had no programming or engineering experience, was tasked with creating a new game that could be installed into the unsold Radar Scope cabinets. He later joked he only got the assignment because "no one else was available".
Supervised by the veteran Gunpei Yokoi, Miyamoto's process was a perfect example of creativity born from constraint. His initial idea was to create a game based on the cartoon Popeye, but when Nintendo failed to secure the license, he simply swapped the characters. The villain Bluto became a giant, brutish ape. The damsel-in-distress Olive Oyl became a woman named Pauline. And the hero Popeye became a short, stout carpenter initially named "Jumpman". The ape, Miyamoto decided, would be called "Donkey Kong" to convey a sense of stubborn stupidity.
The game itself was revolutionary. Instead of a single, repeating screen, Miyamoto designed four distinct stages that told a simple story—a first for arcade games. The gameplay focused on jumping over obstacles, a mechanic that was far from standard at the time. When the game was sent to Nintendo of America for testing, the staff hated it. But they did give it one lasting contribution. During a heated argument with their warehouse landlord, Mario Segale, over late rent, they jokingly decided to name the game's hero "Mario" in his honor.
Released in 1981, Donkey Kong was a monumental, industry-defining success. It saved Nintendo of America from collapse, generated hundreds of millions in revenue, and launched the careers of both Miyamoto and his little carpenter, Mario. The dynamic was set: Miyamoto, the dreamer, would conjure up fantastical worlds and gameplay ideas inspired by his childhood explorations of the Kyoto countryside; Yokoi, the pragmatist, would figure out how to make them work using "withered technology". This partnership would become Nintendo's creative engine for the next decade.
How a Grey Box Saved an Industry
While Nintendo was enjoying its arcade success, the American home console market was driving off a cliff. The Great Video Game Crash of 1983 was an extinction-level event. The market was oversaturated with dozens of competing consoles and flooded with a torrent of terrible, unregulated third-party games from companies that had no business making them, including Quaker Oats and Purina. Consumer trust was shattered by infamous disasters like Atari's unplayable adaptation of E.T. the Extra-Terrestrial, so many copies of which went unsold that the company famously buried them in a New Mexico landfill. Industry revenues collapsed from $3.2 billion in 1982 to a mere $100 million in 1985. Retailers, burned by mountains of worthless stock, refused to carry anything with the words "video game" on it.
Meanwhile, in Japan, the market was booming. On the same day Sega launched its first console, July 15, 1983, Nintendo released the Family Computer, or Famicom. Designed by Masayuki Uemura, it was a cheap, powerful machine capable of playing near-perfect ports of arcade hits like Donkey Kong. It was an immediate sensation, but bringing it to the toxic American market seemed impossible.
Nintendo's solution was a masterclass in psychological marketing. They understood they weren't just selling a product; they were trying to heal a traumatized market. First, they completely redesigned the Famicom. The playful red-and-white toy-like console became a sleek, grey, VCR-style box, renamed the Nintendo Entertainment System (NES). It looked like a serious piece of home electronics, not a "game console".
The true masterstroke, however, was the inclusion of R.O.B. (Robotic Operating Buddy) in the deluxe launch bundle. R.O.B. was a slow, clunky robot that only worked with two mediocre games. He was, by all accounts, a terrible toy. But he was a brilliant Trojan horse. By packaging the NES with a robot, Nintendo could market it as a sophisticated electronic toy, bypassing the video game aisle entirely and getting it stocked in the toy departments of stores like FAO Schwarz. To further assuage terrified retailers, Nintendo offered an unprecedented deal: they would buy back any unsold inventory, completely eliminating the financial risk that had destroyed so many stores during the crash.
With a test launch in New York City in October 1985, and powered by the revolutionary killer app Super Mario Bros., the NES slowly but surely clawed its way into American homes, single-handedly resurrecting an industry everyone had left for dead.
Part IV: The Console Wars and 3D Frontiers (1990s)
"Genesis Does What Nintendon't": The 16-Bit War
Having vanquished the ghosts of Atari, Nintendo entered the 1990s as an undisputed titan, controlling over 90% of the American video game market. Their dominance seemed absolute. But a rival was emerging from the arcades, ready to challenge the throne. That rival was Sega.
Sega launched its 16-bit Genesis console in North America in 1989, a full two years before Nintendo's Super Nintendo Entertainment System (SNES) would arrive. This head start was crucial, but Sega's real weapon was its attitude. This wasn't just a hardware battle; it was a culture war. Nintendo was for kids and families. Sega, with its sleek black console and aggressive marketing, was for cool teenagers.
Their ad campaigns were legendary for their audacity, directly attacking their rival with the iconic slogan, "Genesis does what Nintendon't". They created their own mascot, Sonic the Hedgehog, a spiky blue blur with a rebellious streak designed to be the antithesis of the plodding, wholesome Mario. The battle reached a fever pitch with the release of the violent fighting game Mortal Kombat. On the Genesis, players could input a code to unlock the game's infamous blood and gore. On the SNES, Nintendo demanded the blood be replaced with grey "sweat" to protect its family-friendly image. The uncensored Genesis version outsold its rival dramatically, proving that Sega's edgy strategy was working.
For a time, Sega was winning. By 1993, they had captured over half the market share. But Nintendo fought back. The SNES was a technically superior machine in many ways, with a larger color palette and a more advanced sound chip. More importantly, it had the games. Titles like The Legend of Zelda: A Link to the Past, Super Metroid, and late-generation marvels like Donkey Kong Country showcased a level of artistry and technical wizardry the Genesis couldn't always match. In the end, the SNES narrowly won the war, selling 49.1 million units worldwide to the Genesis's 29 million. But Sega had drawn blood. Nintendo was no longer invincible.
The Betrayal That Created a Rival: The Nintendo PlayStation
While Nintendo was busy fighting Sega on the front lines, it was making a far more catastrophic mistake behind the scenes. In the late 1980s, Nintendo partnered with a promising electronics company to develop a CD-ROM add-on for the upcoming SNES. That company was Sony.
The project, led by a brilliant Sony engineer named Ken Kutaragi, was to be a hybrid machine called the "Play Station"—a console that could play both SNES cartridges and new, high-capacity "Super Disc" games. Sony produced around 200 prototypes of this mythical machine, a holy grail for collectors today. But as the project neared completion, Nintendo president Hiroshi Yamauchi grew wary of the contract terms, which gave Sony too much control over the licensing of CD-based software.
What happened next was an act of brutal corporate betrayal. At the 1991 Consumer Electronics Show, just one day after Sony had proudly announced the Play Station to the world, Nintendo took the stage and announced it was unceremoniously dumping Sony and partnering with their direct competitor, Philips, instead. The public humiliation was immense. Sony's leadership was furious and wanted to scrap their video game ambitions entirely. But Ken Kutaragi, the father of the project, convinced them to channel their rage into revenge. They would take the technology they had developed for Nintendo and build their own standalone console.
That console, born from a partnership Nintendo sabotaged, became the PlayStation. It would go on to sell over 100 million units and completely dominate the next generation of gaming. In one of the greatest strategic blunders in corporate history, Nintendo had created its own most formidable enemy.
A Three-Pronged Revolution and a Red-and-Black Nightmare
As the 3D era dawned, Nintendo prepared to leapfrog the competition with a technological marvel. Developed in partnership with high-end computer graphics company Silicon Graphics, the Nintendo 64 was a 64-bit beast that promised to revolutionize gaming. Its launch was defined by two radical, and controversial, decisions.
First was its controller. Shaped like a bizarre, three-pronged trident, it was unlike anything seen before. At its center was the first-ever analog stick on a standard home console controller, an innovation designed in tandem with Super Mario 64 to provide fluid, intuitive control in a 3D space. It was weird, it was confusing to hold, but it fundamentally changed how 3D games were played forever.
Second was the fateful choice to stick with ROM cartridges while the PlayStation and Sega Saturn embraced the cheaper, higher-capacity CD-ROM format. Nintendo argued that cartridges offered faster loading times and were harder to pirate, but their limited storage space and high manufacturing costs were a massive deterrent for third-party developers. The most damaging defection was from Square, who moved their highly anticipated epic Final Fantasy VII to the PlayStation. That single decision is often cited as the moment that cost Nintendo the console war.
Despite being outsold three-to-one by the PlayStation, the N64's legacy was secured by its software. Super Mario 64 didn't just move Mario into 3D; it wrote the entire grammar for 3D platforming that developers still use today. And The Legend of Zelda: Ocarina of Time was a transcendent masterpiece, introducing mechanics like Z-targeting that became industry standards and is still regularly cited as the greatest video game ever made. Nintendo proved that revolutionary software could make people forgive even the most controversial hardware.
Simultaneously, however, the company was producing its most humiliating failure. While the N64 was being perfected, Gunpei Yokoi was allegedly pressured into rushing out an interim console. The result was the Virtual Boy (1995). It was a portable console that wasn't portable, requiring a tabletop stand. It was a virtual reality headset with no head tracking. And its "true 3D graphics" were displayed in a nauseating, headache-inducing monochrome of red and black, chosen simply because red LEDs were the cheapest available. With a tiny library of 22 games and selling a pathetic 770,000 units, the Virtual Boy was discontinued in less than a year. It was a commercial and critical catastrophe of epic proportions, a failure so total that it is rumored to have led to the legendary Gunpei Yokoi's departure from the company he had saved decades earlier.
Part V: The Modern Era of Highs and Lows (2000s – Present)
The Little Purple Box That Could (But Didn't Sell)
Entering the 21st century, Nintendo was on the back foot. The PlayStation had redefined the market, and a new challenger, Microsoft's Xbox, was on the horizon. Nintendo's response was the GameCube (2001). Codenamed "Dolphin," it was a quirky, compact purple cube with a handle on the back, as if it were a gaming lunchbox.
Learning from the N64's mistakes, the GameCube was powerful and relatively easy for developers to work with. It boasted one of the most beloved controllers ever designed and a library filled with timeless masterpieces: the atmospheric isolation of Metroid Prime, the competitive perfection of Super Smash Bros. Melee, the stunning art of The Legend of Zelda: The Wind Waker.
By almost every metric except sales, it was a triumph. But in sales, it was a distant third. The GameCube sold just under 22 million units worldwide. This was slightly behind the newcomer Xbox's 24 million, but both were utterly annihilated by the PlayStation 2, which sold a staggering 155 million units, making it the best-selling console of all time. The reasons were clear: the "kiddy" design alienated the growing market of adult gamers, and its proprietary mini-disc format meant it couldn't function as a DVD player, a key selling point that made the PS2 the media hub of the living room. Nintendo had built a fantastic game console in an era when people wanted an all-in-one entertainment machine. They had lost the console war, again.
The Blue Ocean Tsunami
Beaten soundly in the race for graphical horsepower and multimedia features—a "red ocean" of bloody competition—Nintendo's new president, Satoru Iwata, decided to stop competing altogether. He embraced a business concept called the "Blue Ocean Strategy". The goal was to abandon the crowded, competitive market and create a new, uncontested one by targeting people who didn't traditionally play video games.
The first test of this new philosophy was the Nintendo DS (2004). While Sony's competing PlayStation Portable (PSP) was a sleek powerhouse designed for core gamers, the DS was a chunky, plastic clamshell device with two screens, one of which was a touch screen. It was technologically weaker, but its novel interface opened the door to entirely new forms of gameplay. With accessible, innovative titles like the pet simulator Nintendogs and the puzzle game Brain Age, the DS brought in millions of new players—women, older adults, and casuals who had never owned a gaming device before. It was a colossal success, selling over 154 million units and becoming the best-selling handheld console in history.
The strategy culminated with the Nintendo Wii (2006). Internally, the Wii was little more than a slightly more powerful GameCube—a perfect example of Yokoi's "withered technology". Its genius was not in its processor, but in its controller: the Wii Remote, a simple, wand-like device that used motion controls. Bundled with the incredibly intuitive Wii Sports, the console became a global cultural phenomenon. Suddenly, video games were a group activity. Grandparents were playing virtual bowling with their grandchildren; families were gathering for virtual tennis matches. The Wii sold over 101 million units, handily outselling the far more powerful PlayStation 3 and Xbox 360. By refusing to fight the console war, Nintendo had won it.
The Hangover and the Grand Comeback
Nintendo's history is a repeating cycle of success and overcorrection, and the follow-up to the Wii was a textbook example. The Wii U (2012) was an unmitigated disaster, a commercial failure on a scale not seen since the Virtual Boy. It sold a dismal 13.56 million units in its entire lifetime.
Its failure was multifaceted. The primary cause was a marketing catastrophe. The name, "Wii U," was confusing, and the advertising focused almost exclusively on its new tablet-like GamePad controller. This led a huge portion of the casual audience that loved the Wii to believe the Wii U was not a new console, but merely an expensive accessory for the one they already owned. Unlike the Wii's motion controls, which had an immediate, obvious purpose, the GamePad's second screen often felt like a solution in search of a problem, a gimmick that complicated more games than it enhanced. The console was also underpowered compared to the upcoming PS4 and Xbox One, leading to weak third-party support and long, painful software droughts.
Once again, Nintendo was on the ropes. And once again, they came back with a brilliant, philosophy-driven idea. The Nintendo Switch (2017) was the ultimate course correction. It took the one good idea from the Wii U—playing console games on a handheld screen—and perfected it. It was a true hybrid console, seamlessly transitioning from a home console docked to a TV to a powerful portable device.
The marketing was crystal clear, demonstrating the "switch" concept in its very first trailer. The device was sleek and appealing to core gamers and families alike. And it launched with one of the most acclaimed video games of all time, The Legend of Zelda: Breath of the Wild. The Switch was a runaway success, reversing the company's fortunes and selling over 150 million units, making it the third best-selling console in history. It was the ultimate synthesis of Nintendo's long history, merging its historically separate home console and handheld divisions into a single, elegant device. It was the culmination of everything the company had learned from a century of triumphs and failures.
Conclusion: The Secret Sauce
To chart Nintendo's 130-year history is to witness a bizarre, repeating cycle of hubris, failure, and brilliant reinvention. The company that dominated the 8-bit era with the NES grew complacent, only to be humbled by Sega. The arrogance that led them to betray Sony created their most powerful rival. The runaway success of the Wii led directly to the spectacular failure of the Wii U. For Nintendo, catastrophic failure isn't a bug; it's a feature of their creative process. It is the necessary precursor to their greatest innovations.
The company's true "secret sauce" lies not in any one product, but in the dual philosophies of its two most legendary creators. Gunpei Yokoi's pragmatic "Lateral Thinking with Withered Technology" provides the foundation: use simple, affordable technology to create the canvas. Shigeru Miyamoto's design philosophy provides the art: fill that canvas with unique, joyful experiences drawn from the real world, focusing not on what players say they want, but on creating new forms of fun. One is the engineer's mind, the other the artist's heart. Together, they form the soul of Nintendo.
Perhaps the original, uncertain meaning of the company's name was the most prophetic after all. For more than a century, Nintendo has succeeded not by chasing trends or adhering to market research, but by taking wild, imaginative leaps of faith. Time and again, they have ignored the competition, defied expectations, and trusted in the simple, powerful idea that nothing is more important than fun. They have, in their own strange and wonderful way, consistently left their luck to heaven.
