Huang Renxun visited Japan to thank Sega: Without the US$5 million investment back then, NVIDIA would not be what it is today
Nvidia CEO Jensen Huang on Wednesday recalled a key turning point in the company's history: Sega's last-minute investment allowed the troubled chipmaker to survive, develop over the long term and eventually become a giant in the field of artificial intelligence. During a trip to Tokyo this week, Huang personally thanked former Sega president Shoichiro Iri for a decision he made three decades ago that ultimately saved Nvidia from collapse. Huang recalled during the meeting that Sega's support came after Nvidia suffered its first major setback. "If it weren't for everything Sega has done for Nvidia...Nvidia wouldn't exist today," Huang said. He added: "In 1995, NVIDIA was almost on the verge of bankruptcy. The technology route we chose back then was completely wrong, but now we are here and become the world's most valuable company. This is simply incredible." In 1995, NVIDIA launched its first graphics processor, NV1. This chip uses surface rendering technology instead of the triangle rendering scheme that later became the industry standard. After the company decided to use triangle rendering technology in the DirectX graphics interface, NV1 quickly lost market value, and the next-generation graphics chip project jointly developed by Nvidia and Sega was also terminated. After the failure of this technology bet, Nvidia only had enough liquidity on its account to last for about 30 days. Huang Renxun flew to Japan to meet with Shoichiro and proposed converting Sega's arrears under an existing contract into an equity investment of US$5 million. Huang Renxun admitted at the time that the investment was "most likely in vain", but at the same time said that this was Nvidia's only chance to survive. Shoichiro finally persuaded Sega's board of directors to approve the investment. The funds allowed Nvidia to survive for about six months and survive the crisis of life and death.