Pudgy Penguins CEO says the praise he’s getting is ‘actually pretty sad’: NFT Creator

Pudgy Penguins was minted in July 2021, but quickly faced major drama after its former founder was suspected of backing the project.

A few months later, Luca Schnetzler intervened. With an entrepreneurial streak since his early teens, he had a history of building internet companies and purchased the project and its intellectual property, 8,888 cute little Pudgys, for $2.5 million in April 2022.

It was an instinctive and intuitive decision. I saw something I had invested heavily in before I bought it and thought it had all the potential. I complained and cried to the founders every day about how bad they were and how they could do better. Instead of just doing that, I just got to work, Schnetlzer says.

The story quickly changed from a rug that could go to zero to a story of hope and optimism as Schnetzler laid out a vision for the project that the community could get behind.

Schnetzler became one of the standout PFP project leaders during the NFT bear market, and the Penguins bucked the trend of rock bottom prices. Since he took over as CEO, the Pudgy Penguins floor has increased from approximately 1 ETH to 6.32 ETH. Holders and the broader NFT community believe Schnetzler has a game plan for success and the ability to execute it.

Pudgy Penguins – A Brave New World (X)

He says the decision to abandon the project was not as risky as it seemed.

We bought something that made almost $10 million in six months for $2.5 million. The royalties brought it to half a million dollars a month. On the face of it, it was a pretty good company. Intuitively I think it just comes down to sight. When you close your eyes and picture Pudgy Penguins, it’s pretty easy to see where this thing could go.

Constant momentum and growth have been key to Pudgy’s rise into one of the top PFP projects, with the cute penguin brand spreading across social media beyond traditional crypto channels like X and Discord. Pudgy’s Instagram has just crossed the 1 million followers mark, while his GIF strategy has been very effective, just days ago he bridged the gap of 10 billion views.

Schnetzler finds it a little sad that he’s receiving so much praise, when it only highlights how little effort other PFP projects have put into growing their brands.

Everyone says their NFT project is a brand, that they’ve raised hundreds of millions of dollars from the community, and that they’ve raised venture capital at ridiculous valuations. Yet none of them actually do the basics of building a brand, he says.

Some people are really singing my praises, and it’s actually quite sad because I think we do some things really well. Don’t get me wrong, but I mean, this should have been the bar all along. The fact that we are doing so many things that so many projects aren’t doing when they have 10 to 20 times the resources and 2 to 3 times the experience is quite shameful.

Chubby Penguins #6775 (OpenSea)

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Chubby Penguins #6179 (OpenSea)

Chubby Penguins #3564 (OpenSea)

Finding the entrepreneurial spirit

Despite being only 25 years old, Schnetzler started his entrepreneurial journey over a decade ago. Schnetzler grew up in poverty and bounced from couch to couch with friends. He says he had to start earning at an early age.

“I honestly haven’t been to school in 10 years and it’s kind of crazy to say, but it has been,” he says, noting that most people don’t start working until they’re out of college in their twenties rounded.

Then you do that ten years after you leave college and you’re 33, and then people start seeing success in their 30s. That seems to be the time horizon. I think my childhood forced me to start early. I didn’t have the luxury of relaxing or having a childhood where I could just go home and play video games without worrying about anything. I was forced to go to work and figure things out.

Character building versus brand building

To date, most PFP projects have been built around a centralized nature with a variety of different properties to give each NFT a slightly different look and feel. Take the OG collection of CryptoPunks, the Bored Apes, and that includes the Pudgys. But this is not the case for Gary Vees VeeFriends, which features 270 individual characters.

Schnetzler believes that building character around one individual character is the easier of the two options.

Ultimately, I think Gary is trying to tackle a more difficult challenge. It’s part of the cards that I’ve been dealt and that I’ve been dealt, and he’s made his cards. I think he’s doing a great job with VeeFriends. I think ultimately he has to create fame. Creating awareness around a character is a lot easier than creating awareness around a brand, says Schnetzler.

They are two different things and because his universe is not based on one character, but on a multitude of different characters and different animals in different forms. He gambles and takes a stab at the brand, and the brand name versus the character.

I go after the character first and then worry about the brand because I believe there are plenty of people who love penguins and there are very few penguin brands.

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Luca Schnetzler IRL at Walmart (X)

A Brave New World – Walmart Pallet Program

In September this year, Pudgys announced a groundbreaking deal with retail giant Walmart, which saw physical Pudgy Penguin toys available for purchase in prominent locations in more than 2,000 stores across the US.

The pallet program is one of the most prestigious spots you can get because it provides prime real estate for people walking the floor. It reflects Walmart’s belief in the brand and their belief in NFTs and Web3 as a vertical for their retail locations, Schnetzler says.

If that can become a common norm in the world’s largest retailer, it gives us a real chance to succeed. It’s one thing to stand in the crevices of the toy shelf, it’s another to be front and center for everyone to see. That program doesn’t happen for brand new brands. It’s normally a show for Barbie, Teenage Mutant Ninja Turtles, or people who have movies and TV shows behind their releases.

Building a traditional brand without a playbook

One of the most frequently asked questions in a PFP project is: “how do you return value to the holders?”

In response to criticism of the toy product expansion, Schnetzler explained his plan for how Pudgy Penguins think about adding value to holders using a classic funnel diagram.

The funnel isn’t something I really invented. I mean, you can throw Star Wars and any other major heritage IP into that funnel, and that’s the strategy. However, the idea with NFTs is that the value of the first edition collectible is a huge anchor for the company. Placing a first-edition collectible from an old brand at the bottom of that funnel still makes the most sense, he says.

I want to build an old brand, like a Hello Kitty, a Star Wars and a Pokemon.

That’s easier said than done, he admits, saying there is no roadmap to follow for a PFP project.

Hello Kitty took 60 years to build. My holders don’t have 60 years to start building something. If I lose momentum and traction within the holders’ base, then I ultimately lose everything, because I don’t believe you can build a successful Web2 business while your Web3 business fails.

Pudgy World (pudgypenguins.com)

Quick questions and answers

Your entrepreneurial inspiration

I love everything that I think Steve Jobs represents. For me personally, I’ve tried to be my own man, but the one person I’ve found tremendous inspiration from, which you can tell from my leadership style, is actually Steve Jobs.

The intense pressure of a founder

It’s not easy, but it’s not the worst either. One of the reasons we came here is because of the community. I think I’m in a great situation because I bought the project and didn’t take any money from them. The nature of people who hold Pudgy Penguin PFPs is that they are good people.

You can’t really be an angry, miserable person and then click on a Pudgy Penguin. Art creates a culture that already filters out a lot of that nonsense. Now I sympathize with many other people I see going through the chaos.

What you would tell a mother about Pudgys

What I would say to a mother is, hey, this is a valuable proposition for your son or daughter. This is way more fun than any other $10 toy.

Why? Because they unlock a lot of things in the digital world that not only keep them entertained when they go to bed, at recess or on the playground. But also entertains them when they are at home on their iPad and computer. It’s a 2-for-1 value for money special.

Were the Pudgy gifs planned?

The gifs were completely random. But as soon as we saw it, we quadrupled, but at first it was totally random. It was a pure accident, but a happy accident.

I don’t need people to know anything about Pudgy Penguins right now, but if you want to know something when NFTs are the talk of the town again, and all those people have been using Pudgy GIFs this whole time, that will be a really good source of information are. credibility for them once everyone starts wanting to buy NFTs.

What is your position on royalties?

It shouldn’t be 0% and it shouldn’t be 5% either. I think it’s somewhere in the middle. I think the number is between 1% and 1.5%, which is where I think the enforceable royalties should be. The reason for this is that you simply have to encourage the creator. [That’s] what made YouTube great, what made TikTok great.

Are you a Wim Hof ​​fanboy?

Every day I do his breathing technique and it gets me high. I recommend it because it’s the fastest way to get high for free. I’m also preparing my cold plunge now.

Where will Pudgys be in three years?

We are the face of NFTs, we are the face of Web3. We have brought the most value to the holders on an emotional and fiscal level. In three years we would probably launch a movie. The movie is close.