NFT
Pudgy Penguins, a non-fungible token (NFT) project consisting of cute chubby birds, has seen waves of success and misfortune since its debut in July 2021, including a rapid drop in price and sentiment when doubts about the founders arose.
The community of holders, known as Pengus or “the Huddle,” was angry that the founders had failed to live up to the project’s original roadmap. Their feathers were further ruffled after allegations arose that the founders had taken money from the treasury.
This led to some very angry birds in the Huddle, who in January 2022 ousted the founders in a community vote. a community united by disappointment.
But this bird story took another flight path: In April 2022, a Los Angeles entrepreneur and member of the Huddle herself, Luca Netz, swooped in and spearheaded the purchase of the brand for 750 ETH, or $2.5 million at the time, with a promise to build the brand and promote better communication. A little over a year later, new investments, real life toys and an uptick in NFT sales have restored the penguin NFTs ethos of “good vibes and positivity for all” and penguin prices have reached new heights.
The penguins’ march to success
After Luca Netz and the new team took over the project, they laid down their plans to focus on building out the intellectual property (IP) of the project and “be the brand leading the way in onboarding people from Web2 to Web3.” Unlike the original founders, they took steps to put that roadmap in place, announcing in the summer of 2022 that they would be making toys based on the penguin NFTs and releasing a children’s book.
In an interview with CoinDesk TV, Netz said he was “a firm believer that IP will become the Trojan horse to really bring hundreds of millions of people into crypto and into Web3.”
“To participate in space, they have to fall in love with a character and this character to us is Pudgy Penguins,” he said.
The mood and momentum had changed, leading to another all-time high-sale in August and a Christmas rally in December 2022, despite the overall crypto winter.
In May 2023, they announced another round of funding of $9 million and soon after launched the promised toy, which reportedly sold 20,000 units in a few days and the bottom price of the project rose to 6.2 ETH on May 20, 2023 , according to data from NFT marketplace OpenSea.
Along with the toys, the team unveiled Pudgy World, which connects people’s real toy purchases to the digital world and onboards them to Web3 in a frictionless fashion – the “Trojan Horse” Netz talked about. Toy buyers who register with an email address receive NFTs and a crypto wallet without even realizing it, easing the otherwise tedious process of setting up and funding a crypto wallet.
Capping off a strong first half of 2023, NFT lending platform Blend announced the inclusion of Pudgy Penguins on their platform, further legitimizing its place among other popular collections such as Azuki and Bored Ape Yacht Club.
The Huddle takes center stage
While the list of NFT projects that looked like the next big thing and then burned out is huge, there is a much smaller group of projects that endured a dark, icy winter. So what went right for these penguins?
In Web3, the power of the community should not be underestimated. Netz and the leadership team understood that they had to earn their trust and support or else they would suffer the same fate as the founders.
To that end, the team kept their promises to post “monthly updates on penguins that may have been cave-fishing” on their blog, as well as providing regular updates on Twitter and Discord. Furthermore, they enabled the community to create sub-communities or clans and planned real-life and virtual events to connect the community.
On the other hand, NFT projects like More than Gamers suffer from unclear communication and a general lack of transparency, while the Pixelmon NFT promised the “biggest, highest quality game” and delivered what even they had to admit was ridiculously bad art. has managed to bounce back from writing.
The Huddle can also share in the success of the Pudgy Penguins. Part of the project’s DNA is that holders can use their IP and profit from their penguins, whether through licensing or other deals.
Luca Netz said on a Twitter Spaces with Blur founder Pacman on May 25 that the toy was made with the “IP of 16 different holders.” He added that he felt it was his responsibility and the team’s responsibility to help the community make money and find licensing opportunities, as the average person has no idea how to make a licensing deal a success.
Similarly, Web3 giant Yuga Labs has given holders of Bored Apes and other NFTs in their catalog full commercial rights to the IP of those NFTs, and has seen some launches by enterprising holders such as branded restaurants, beverages, clothing, and even musicians using Apes as avatars.
Only time will tell if the project will continue to see success, but the current prognosis looks promising. At the time of writing, Pudgy Penguin NFTs have traded a total of 170,457 ETH in trading volume (over $300 million) and have a floor price of 5.4 ETH, or around $9,700.