Nvidia’s Rescue: A $5m Investment That Changed Course
Jensen Huang thanks Sega for the $5m that saved Nvidia from bankruptcy in 1995.
Nvidia and Sega share a 30-year history. In 1995, Jensen Huang, CEO of the world’s most valuable company, traveled to Tokyo to express his gratitude to Sega for a $5m investment that prevented his company from collapse.
"If not for what Sega did for Nvidia, Nvidia would not be here today," said Huang. "That we had chosen exactly the wrong technology, and that we will be here today, the largest company in the world, is unimaginable."
The Bet That Went Wrong
In 1995, Nvidia released its first chip, the NV1, which utilized curved shapes for graphics rendering instead of triangles. This decision proved detrimental as Microsoft soon established triangles as the standard for PC graphics with DirectX. Nvidia’s NV1 was left obsolete. A subsequent chip in development with Sega was scrapped due to financial constraints. By mid-1990s, the startup had only 30 days of cash remaining, according to Tom’s Hardware.
A Lifeline in Tokyo
Huang flew to Japan to confront Sega about their contractual payment, requesting they convert it into an equity investment. He acknowledged the risk, stating that without this support, Nvidia’s chances were non-existent.
Sega’s Shoichiro Irimajiri agreed and persuaded his board to accept Huang’s plea. The $5m extended Nvidia a crucial six more months, allowing them to develop the RIVA 128—a triangle-based chip released in 1997 that achieved significant success.
A Turnaround and Triumph
Nvidia went public in 1999, and Sega later sold its stake for approximately $15m. Today, Nvidia stands as the most valuable company on earth, with AI chips powering the current tech boom.
Huang, known for his leather-jacketed keynotes and even a CGI representation of himself, frequently shares this near-death experience—this time with the people who wrote the cheque. The visit also marked 30 years of partnership between the two companies, with a new Virtua Fighter game set to launch on Nvidia hardware.