Founded as IRM Corporation in 1979 in Matsubara, Osaka, the company began with the goal to develop electronic game machines. 1981 saw the establishment of Capsule Computer Co., Ltd., and two years later the company released their first machine. A coin-operated game, Little League was released in 1983, along with several other titles, such as Fever Chance.
IRM Corporation changed their name to SAMBI Co., Ltd. and moved to Habikino, Osaka in 1981, and then established Capcom Co., Ltd. as a division to sell software exclusively. Capcom's first arcade game was released in 1984. Titled Vulgus, this game is a top-down shooter which helped to establish standards for Capcom's later games, such as the 1942 franchise.
In 1989, four years after establishing a division of Capcom in the United States, Capcom was merged with SAMBI and Capsule Computer Co., Ltd., and the head office was now located in Higashi-ku, Osaka. In the years following, Capcom released a variety of their popular games, including Mega Man (1987), Ghosts 'n' Goblins (1985), Street Fighter (1987), and Final Fight (1989).