Nintendo: How a Handmade Playing Card Shop Became the World's Most Beloved Game Company

Before Mario ever jumped over a single obstacle, before Pokémon existed, before anyone had heard of the Switch, there was a small shop in Kyoto selling hand-painted flower cards. Nintendo's story is proof that a company's original product rarely determines its final destiny.

A Craftsman's Shop on the Banks of the Kamo River

On September 23, 1889, Fusajiro Yamauchi opened a small shop in Kyoto's Shimogyo-ku district, near the Kamo River, to manufacture and sell hanafuda, traditional Japanese flower playing cards. Card games had long been associated with gambling and viewed with suspicion in Japan, but as the Meiji era loosened old restrictions, Yamauchi saw an opening. His cards were meticulously hand-painted on mulberry-bark paper, a level of craftsmanship that set them apart in a market just beginning to open up. With help from an acquaintance in the tobacco trade, Murai Kichibei, Yamauchi's cards found their way onto national distribution routes, dramatically widening his reach beyond Kyoto.

Yamauchi had no son to inherit the business, a recurring pattern in the company's early history. Leadership eventually passed to an adopted successor, Sekiryo Yamauchi, who became the second-generation head in the early 1930s and helped reorganise the growing card business, establishing Marufuku Co., Ltd. in 1947 as the postwar joint-stock incarnation of the company. When Sekiryo suffered a stroke without a clear successor in place, his 22-year-old grandson, Hiroshi Yamauchi, was called to his bedside in 1949 and took over as president.

The Reluctant Card Company That Went Looking for a New Game

Hiroshi Yamauchi modernised the company's card-making operations, mechanising what had remained largely handcraft work and capturing a dominant share of Japan's domestic playing card market. In 1959, a licensing agreement to produce Disney character playing cards proved wildly popular, and in 1962, the company went public on the Osaka Stock Exchange. But success soon revealed a ceiling, the playing card market itself was simply too small to sustain serious long-term growth.

What followed was a genuinely restless period of experimentation. Nintendo dabbled in ventures ranging from instant rice and a taxi company to, reportedly, even love hotels, most of which quietly failed. The real turning point came in 1965, when the company hired a young maintenance engineer named Gunpei Yokoi. Yokoi had built a simple extendable toy, later branded the Ultra Hand, purely as a personal project, and it became an unexpected commercial hit. Recognising the opportunity, Yamauchi established a dedicated toy and games division under Yokoi's leadership, setting Nintendo on a genuinely new path.

Turning Withered Technology Into Breakthrough Products

Yokoi's guiding design philosophy, often described as "lateral thinking with withered technology," became one of Nintendo's most defining traits. Rather than chasing the newest, most expensive components available, Yokoi favoured mature, well-understood, inexpensive technology, used in creative new ways. This thinking led directly to the Game & Watch series in 1980, handheld games built using the same simple LCD screens found in ordinary calculators, keeping costs low enough to make gaming genuinely affordable and portable for the first time.

Nintendo's path into video games had actually begun a bit earlier, distributing the Magnavox Odyssey console in Japan in 1972, before releasing its own in-house hardware, the Color TV-Game, in 1977. The company's defining breakthrough arrived in 1981 with the arcade game Donkey Kong, designed by Shigeru Miyamoto, which introduced a small mustachioed character who would soon become the most recognisable figure in gaming history: Mario.

In 1983, Nintendo launched the Family Computer, or Famicom, in Japan, released internationally as the Nintendo Entertainment System, which went on to sell nearly 62 million units. The Game Boy followed in 1989, and Nintendo of Europe was established in Germany the following year, cementing the company's global footprint.

Choosing Not to Fight, and Winning Anyway

By the mid-1990s, Nintendo faced a serious new rival. Sony's PlayStation, launched in December 1994, outpaced Nintendo's technically capable but commercially weaker Nintendo 64, eventually selling more than 100 million units against the N64's 33 million. Competing purely on hardware power against deep-pocketed rivals like Sony and Microsoft was proving to be a losing battle.

The philosophy that eventually turned this around traced back to advice Hiroshi Yamauchi gave his successor, Satoru Iwata, who became Nintendo's president in 2002: if Nintendo tried to fight head-on, it would lose, and energy was better spent elsewhere. That thinking crystallised into what came to be known as Nintendo's Blue Ocean Strategy, deliberately avoiding direct competition with Sony and Microsoft's graphics arms race, and instead creating entirely new, uncontested market space built around accessibility rather than raw power.

The Marketing Strategy: Stop Competing, Start Including

This philosophy reshaped everything from product design to advertising. The Nintendo DS, launched in 2004, introduced touch-screen controls that welcomed people who had never considered themselves gamers. The Nintendo Wii, launched in 2006, went even further, built around simple motion controls and family-friendly titles like Wii Sports and Wii Fit. Its advertising deliberately broke from typical gaming marketing built around heroism and spectacle, instead showing families, and notably, grandparents, playing together in their living rooms. Titles like Nintendogs and Animal Crossing widened the audience further still, drawing in players, including many women, who had never engaged with traditional video games before. The Wii and DS together went on to sell more than 200 million units combined, becoming Nintendo's best-selling home console and handheld console respectively. That same instinct, reach the people the industry had overlooked rather than fight harder for the players everyone else was already chasing, would later shape the Nintendo Switch as well.

From Flower Cards to a Global Cultural Icon

Nintendo's journey, from a single handcrafted card shop by the Kamo River to one of the most recognised entertainment companies on Earth, is ultimately a story about a willingness to keep abandoning what had worked before in search of what could work next. Four generations after Fusajiro Yamauchi first hand-painted flowers onto mulberry-bark cards, that same instinct, find the audience nobody else is looking for, still quietly drives every console Nintendo builds.