Jensen Huang's Bankruptcy Gamble
But there was one last hope…video console company SEGA.
“I read BizStory because it’s never boring, and sometimes funny”
- Blackstone Managing Director
Hello everyone.
It’s time for short on the sides and curly on top, suit trousers that sit against the ankle, brown shoes, pink shirts, thin lapels and AirPods worn when not listening to anything. That’s right - it’s intern season.
I was never an intern as I came in the side door to finance, but one has to respect the hustle of these young people. That is, unless they’re the offspring of a senior MD. Saying that, I once got my godson an internship so who am I to talk. My tip: offer to buy a round of drinks and don’t wear a Hermes tie. Godspeed, youngsters.
This week’s newsletter: Steve Schwarzman’s $400m super yacht, how legendary investor John Rogers Jnr beat Michael Jordan in a 1-on-1, influencers are obsessed with Jon Gray’s Hampton’s general store and Jensen’s great escape.
The Secret NVIDIA Bailout
In 1996, NVIDIA was on the verge of bankruptcy - but one secret meeting with an unlikely CEO saved the company…
In the mid-1990s, Jensen Huang and his co-founders were running out of time.
NVIDIA was a young chip company in Silicon Valley, lagging behind its rivals and burning cash. Its first major product had failed. An early graphics chip called the 'NV1' was incompatible with Microsoft’s DirectX standard.
But there was one last hope…the video console company SEGA.
NVIDIA spent nearly a year trying to build the graphics chip for Sega’s upcoming Dreamcast console.
But they failed…again.
NVIDIA couldn’t deliver what Sega needed in time, and it was highly unlikely they would be paid their $5 million fee. Jensen had to do something extreme to save the company, so he set a clandestine meeting with Sega President Shoichiro Irimajiri.
He told Shoichiro the truth: NVIDIA technology wasn’t good enough. But, straight after his apology, Jensen asked for the final $5 million payment the contract owed - not as a fee, but as an investment.
He framed the investment as a Hail Mary - one last throw of the dice.
NVIDIA was going out of business, if Sega had an equity stake at least there was some chance of an upside.
“The chance of returning the money was close to zero,” Jensen said.
Sega appreciated Jensen’s honesty, and agreed to convert their final $5 million payment into a stake in NVIDIA. Jensen immediately re-assigned every remaining engineer on a single product: a new graphics chip designed the right way.
In 1997, NVIDIA released the RIVA 128 chip. It worked. Sales exploded, and the company survived.
When NVIDIA went public in 1999 at a $300 million valuation, Sega sold its stake and moved on, grateful to exit.
That same stake today would be worth around $1 Trillion.
Reflecting on that time, Jensen said:
“Greatness comes from character, and character isn't formed out of smart people. It is formed out of people who have suffered.”
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Finance Culture
The best basketball player (and arguably best athlete) of all time - Michael Jordan - used to host a networking, business and sports summer camp for over-35 year olds. At the end of every camp, he would invite any camp member to play him 1-on-1. For seven years straight, camp members tried and dismally failed. Until, in stepped John Rogers Jnr. John founded Ariel Investments at just 24-years-old, and is a noted value investor who boasts Warren Buffett as a friend. However, before all this, John was the star player for the Princeton Tigers. Once the best of three 1-on-1 started, John gave Jordan a few shimmy’s - and beat him. The best part? The WSJ was on site that week filming, and got the whole thing on camera. Check it out below. Listen out for Michael saying ‘oh no!’ when he realises John’s final shot is going in to beat him. Marvellous.
Steve Schwarzman’s new boat is ready. I say boat, but I actually mean $400 million yacht. It’s now sitting in the port of Gibraltar. For a full breakdown of the new yacht, including a peek inside the niche world of superyachts - check out this guys astute breakdown on YouTube.
I posted a couple of real life finance stories on my newly minted Instagram account. One of them did OK and was seen by 35,000 people. One person commented that I was ‘lucky’, another person espoused a wild conspiracy theory about Blackstone I’d never heard before. But there were a few normal people on there too. If you have Instagram, follow me here.
Everything Blackstone President Jon Gray touches seems turns to turn to gold - even the small village shop he and his wife bought during the pandemic. The Sagaponack General Store has become a hub for influencers this summer, and locals haven started kicking off about the noise. Should we really be surprised it’s a hit given it’s in the hands of one the most successful commercial real estate investors ever? This is the guy who flipped EOP for a $26 billion profit before the 2008 crisis. I’m sure he can handle some Tik-Tok dancers.
To finish, read this awesome story told by Wall Street legend Jim Rogers:
Boring_Business@BoringBiz_Jim Rogers said the best advice he ever received on Wall Street was to read and think critically about what you consume Ironically, this advice is now more relevant than ever Cannot tell you how many hedge funds and institutional analysts are simply asking a chatbot to
1:56 PM · Jul 26, 2026 · 65.9K Views14 Replies · 95 Reposts · 1.02K Likes
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Recommendation
For a deep dive into the psyche of Jensen, watch the full fat Joe Rogan 2.5 hour session here.
If you’ve got 5 minutes, watch Jensen personally thank SEGA for saving his bacon here.
Forward this email to one person you know in finance who might get it.
Joseph Cass