The Nintendo They've Tried to Forget: Gambling, Gangsters, and Love HotelsS

Nintendo, the world's family-friendly video game maker, formed under less virtuous auspices. Before Nintendo made video games, they made playing cards for gangsters and ran their own love hotel, which some assert their own president frequented—during work. Saucy!

It's deathly quiet. I can hear my footsteps as I trundle down a small side-street, where the road narrows and then widens. It's early afternoon, and snowing—the last rattle of winter. Near a bridge that straddles the river, next to a lifeless fruit stand, sits the birthplace of one of the most successful video game companies in the world.

You wouldn't know the three-story stone structure—a rarity in a country that historically favors wood—is anything special if you missed the plaque that reads, "The Nintendo Playing Card Co." The windows are dark. Some cardboard boxes are visible in the second story window. You also wouldn't know that the area houses several Yakuza strongholds, unless you'd talked to the locals. The area looks safe and sleepy by Western standards.

But that's the thing about crime and Japan. Like yakuza tattoos, it seethes just underneath the surface.

In the late 19th century, thirty-year-old Fusajiro Yamauchi saw an opportunity when the Meiji Government legalized hanafuda playing cards in 1886 after opening itself to the West. Those like Yamauchi who previously played cards illicitly were permitted to openly indulge in their pastime. Yamauchi set up shop in fall 1889, producing hand-made hanafuda cards. The stone building, erected in 1933, often referred to as the original Nintendo headquarters, is not where the card company was born. The first Nintendo office was in a small, two-story building next to the stone structure. It's here that Yamauchi started crafting and selling Nintendo hanafuda. The original building has since been bulldozed. It is now a parking lot.

In recent years, a more sanitized version of Nintendo's history was embraced by the company, one in which Nintendo went from a humble playing card company to an international and iconic game company. Rags to riches.

The truth is actually riches to even more riches. It involves Japanese organized crime and gambling, sex, and even linguistics.

The Nintendo They've Tried to Forget: Gambling, Gangsters, and Love HotelsS

Hanafuda is a traditional Japanese card game that is often played during the New Year's holidays, at least today. In the 1880s, it was played by gangsters, and its popularity spread due in large part to gambling. The Japanese word "yakuza" originally meant "useless individuals" and is derived from a losing hand played with hanafuda. Just as Nintendo's lore is inseparable with hanafuda, so is hanafuda impossible to disentangle from the history of Japanese organized crime.

That isn't to say Nintendo was originally run by Japanese gangsters. Saying that would be like assuming that all Vegas dice makers are run by the mob. However, there is no doubt that yakuza were gambling on Nintendo hanafuda. Fusajiro Yamauchi, it seems, saw a demand and then filled it. For customers, he only had to look outside his door. The area was teeming with bakuto (groups of gamblers) and racketeers.

The original Nintendo headquarters is located in a part of town that's the turf of the Aizukotetsukai, one of Kyoto's oldest and most powerful yakuza groups. Now in its sixth generation, the Aizukotetsukai were established in Kyoto in 1868, over a decade after the U.S. "black ships" arrived on Japanese shores that opened the country to the West. The group's founder Senkichi Kousaka, aka "Kotestsu Aizu," was an infamous gambler and swordsman in his day.

"The Aizukotetsukai used to control the town but it's unclear if they controlled Kyoto at the time Nintendo was born," explains Jake Adelstein, author of Tokyo Vice and co-editor of website Japan Subculture. Nevertheless, the group remains active in modern Kyoto, as evident in this police archive still from an Aizukotetsukai ceremony.

The Nintendo They've Tried to Forget: Gambling, Gangsters, and Love HotelsS

Equally unclear is the meaning of Nintendo (任天堂), which has always been ambiguous - even to the Japanese. It's commonly said to refer to「運を天に任せる」or, as it's often translated, "leave luck to heaven".

Poetic? Yes. But that translation does not take into account the context of either syllables "nin" (任) or "ten" (天). As mentioned in The History of Nintendo by Nintendo Dream writers Florent Gorges and Isao Yamazaki, "ten" (天) contains the same kanji character as used in the word for the mythical being Tengu (天狗). Gorges and Yamazaki explain that soon after Nintendo was originally founded in the late 19th century as a playing card company, company president Fusajiro Yamauchi brainstormed ways to get his company out of a hanafuda sales slump. The company's premium cards were not doing well as they once had, so Yamauchi came up with the idea of selling lower quality cards under the name of "Tengu".

The selection of Tengu was no accident. Tengu had been a symbol for playing cards and illegal gambling. The reason for this is that mythical Tengu has a long nose, and the word for "nose" (hana) is pronounced the same as the word for "flower" (hana). Thus, according to The History of Nintendo, those visiting the gambling dens of Osaka and Kyoto would rub their nose as a sign that they were looking for gambling games. Nintendo's Tengu-brand cards weren't just winking at gambling-they were advertising it.

"Do" (堂)—which means "shrine" or "sanctuary"-is frequently used by Japanese businesses that range from supermarkets to bookstores to add prestige to their name. ("Shop the Temple of Savings!") If one translates "nin" (任) as "let someone do," as Gorges and Yamazaki have, the word "Nintendo" (任天堂) could then mean "the temple of free hanafuda" or "the company that is allowed to make (or sell) hanafuda". As their book points out, Hiroshi Yamauchi, the great-grandson of the company's founder, admitted that even he does not know the true meaning of the company's name, saying that "to leave one's luck to heaven" was a "plausible explanation". Plausible, sure. Likely? Probably not.

The Nintendo They've Tried to Forget: Gambling, Gangsters, and Love HotelsS

However, according to other experts, "nin" has an even more overt etymological connection: it could be a nod to the actual gamblers that played hanafuda-the yakuza.

Jake Adelstein asked two current members of the yakuza how they interpreted the company's moniker. Their opinion was exactly the same. It's apparently commonly thought that the "nin" (任) in Nintendo is the "nin" from "ninkyo" (任侠) or "chivalry". According to Adelstein, "The yakuza don't think of themselves as criminals, because they argue that they are ninkyo dantai, aka 'humanitarian groups'." The concept of chivalry, or "ninkyo", is synonymous with the yakuza. "Whether true or not, they claim that the 'nin' (任) character in 'Nintendo' (任天堂) comes from the word 'ninkyodo' (任侠道) or 'chivalrous way', which is how the yakuza think of themselves," says Adelstein. "Like many things, only the founder really knows. But two yakuza I spoke with both shared the same opinion: Nintendo began by providing cards for gamblers, and many yakuza groups began as associations of gamblers called bakuto. Nintendo was expressing thanks to their customer base with their name. That may simply be urban legend in the underworld. Only the founder would know. Unless you have a really good Ouija board, contacting him may be difficult."

Decades later, Gunpei Yokoi, the famed inventor behind the Game Boy, recalled that one of his first jobs at Nintendo during the 1960s was to check the machines that produced hanafuda cards. According to The History of Nintendo, Yokoi said, "This task was important since these cards were often used for gambling." That's why it was important that the machines didn't produce faulty cards that could be used to cheat. Yokoi recalled that "people from the local mafia would often come to Nintendo, very angry." It seems these pissed-off yakuza lost lots of money due to defective hanafuda cards.

During the late 1970s and early 1980s, Nintendo blossomed into a video game titan. The Kyoto-based company was a family business, helmed by Hiroshi Yamauchi, and had talented creators like Shigeru Miyamoto, who created Mario and Zelda, as well as Gunpei Yokoi, who was responsible for the Game Boy. Thanks to the Nintendo's success largely due to his his own gumption and hard work, Yamauchi became one of the country's richest individuals.

The Nintendo They've Tried to Forget: Gambling, Gangsters, and Love HotelsS

Money and Yamauchi were not strangers. While he was born into wealth, like many too young to serve in the military during World War II Yamauchi worked in a military factory. But unlike the typical Japanese citizen, who was living hand-to-mouth in the days that followed the war, the Kyoto-born Yamauchi was off to Tokyo to study law at the prestigious Waseda University as U.S. forces were occupying the country.

This was an age in which high school was considered higher education and university was reserved for only the country's most elite and wealthy. Nintendo had-like Japan itself-seen better days, but found itself bolstered by becoming the "official" supplier of playing cards for U.S. troops. As with the gamblers, Nintendo saw an opportunity and moved to supply soldiers with cards. Yamauchi's post-war digs were far better than most, and young Hiroshi, with his fondness for chic suits, fancy dinners and imported liquor, enjoyed his life in occupied Tokyo, which was still in shambles.

The Nintendo They've Tried to Forget: Gambling, Gangsters, and Love HotelsS

But then Yamauchi was called back to Kyoto to the three-story stone headquarters. His grandfather was dying. Young Hiroshi was to run Nintendo.

Under Hiroshi Yamauchi, Nintendo expanded its card playing audience by doing things like securing the right to make Disney playing cards. The company, however, continued to make cards directed firmly at adults, as evident by Nintendo's "nude cards". Besides Japanese nudes, the company also turned out cards that depicted Playboy's infamous Marilyn Monroe centerfold—a marked difference from the puritanical Nintendo of the 1980s that shied from the mere hint of sexuality.

However, it was also under Yamauchi that the card maker tried branching out into many failed expansions: making noodle soup, ball point pens, LEGO-like blocks, baby swings and even a photo copier. LEGO even unsuccessfully sued Nintendo for its "N&B Blocks," but lost because Nintendo bricks also included peanut-shaped round blocks.

It was in the swinging ‘60s that Nintendo began operating a taxi company called "Daiya" or "Diamond," a handy purchase that likely paired well with another acquisition around the same time: a love hotel, one of Nintendo's least family-friendly ventures. (Or most family-friendly, depending on how you look at it.)

Love hotels boomed during the 1960s and 70s. They were, and still are, a place were adults can rent a room for an hour or so and have sex. They're Japan's equivalent of a "no tell" motel. In recent decades, they've become more extravagant with themed rooms, costumes, toys to purchase, food to order and more. They're almost respectable. Love hotels are typically operated in the city's red light districts and run in concord with the country's sex industry, some even offering lower rates if you brought your own, well, prostitute.

The Nintendo They've Tried to Forget: Gambling, Gangsters, and Love HotelsS

The location and name of Nintendo's hotel seems lost to the pages of time. Like many of Yamauchi's ventures, the hotel was a failure. According to The History of Nintendo, local newspapers noted that it might have an upside for the married Nintendo president: "The only benefit Yamauchi might have derived from this is that this time he and his partners don't need to pay for the rooms, and that might in the end constitute a substantial saving." Yamauchi's reign at Nintendo was marked by his repeated desire to, like any good businessman, find new markets. If the love hotel or the copy machine or even the soup with noodles ventures had worked out, Nintendo would have become a very different company.

Nintendo isn't ashamed of its playing card game past, especially as games like hanafuda are no longer simply associated with gambling. The company continues to make hanafuda cards, and Hiroshi Yamauchi created a museum for a card game based on Japanese poetry.

Yet among certain yakuza, especially here in Kyoto, Nintendo's association with organized crime and gambling linger. A car is parked in front of the deserted Nintendo headquarters. A middle-aged man picks up some clothes at the unfashionable clothing shop across the road. That's what passes for excitement today. It's cold enough to snow, but not cold enough to stick to the road-the same road walked by Fusajiro Yamauchi, who over a hundred years ago saw an opportunity to make playing games into a lucrative business and took it without apology.

Disclosure: The History of Nintendo is published by Pix'n Love, which also publishes the French edition of my book Arcade Mania!