Nintendo's Disney-Powered Evolution

A story about how Nintendo evolved from a playing card company in Japan to a gaming giant, as told by Ben and David from the Acquired podcast.

"Nintendo is a 130-year-old company that started in 1890, making hanafuda cards - the Japanese version of playing cards. US playing cards were illegal to import at the time. Their distribution channel was through the yakuza to illegal casinos.

For about 60 years, this was their business before they started making toys. The transformation began with Hiroshi Yamauchi, who was so frustrated with the family legacy that he wanted to diversify the business. In 1959, he formed a partnership with Disney, bringing Disney IP into Japan post-World War 2.

They started with Disney-themed playing cards, then moved into toys. They had a lock on retail distributors, and they leveraged this by telling retailers 'if you want the Disney products, you're going to take our products too.'

This eventually led to their evolution into the gaming company we know today. The interesting part is that for their first 60-70 years, they were deeply embedded with the yakuza, just making playing cards for casinos because casinos need fresh decks for each hand to prevent cheating."