Pudgy Penguins CEO says praise he gets ‘is actually pretty sad’: NFT Creator
Pudgy Penguins minted in July 2021, but quickly saw high drama after its former founder came under suspicion he was going to rug the project.
A few months later Luca Schnetzler stepped in. With an entrepreneurial streak since his early teens he had a history of building internet businesses and bought the project and its intellectual property of 8,888 cute little Pudgys for $2.5 million in April 2022.
“It was an instinct and intuitive decision. I saw this thing that I was hugely invested in before I bought it that I thought had all of the potential. I was complaining and crying on a daily basis to the founders about how they sucked, and how they could do better. Rather than just doing that, I just stepped up to the plate,” Schnetlzer says.
The narrative of quickly shifted from a rug that could trend to zero to one of hope and optimism when Schnetzler set out a vision for the project the community could rally behind.
Schnetzler became one of the standout PFP project leaders during the NFT bear market, and the Penguins bucked the trend of cratering floor prices. Since he took over as CEO, the Pudgy Penguins floor has risen from around the 1 ETH mark to 6.32 ETH. Holders and the wider NFT community believe that Schnetzler has a game plan for success and the ability to execute it.
He says the decision to snap the project up wasn’t as risky as it may have seemed.
“We bought something that netted almost $10 million in six months for $2.5 million. Royalties were making it half a million dollars per month. It was a pretty good business on its face. Intuitively, I think it just comes down to the vision when you close your eyes and you picture Pudgy Penguins, it’s pretty easy to see where this thing can go.”
Constant momentum and growth has been key to Pudgy’s ascent into one of the top PFP projects, with the cute penguin brand spreading across social media outside of traditional crypto channels like X and Discord. Pudgy’s Instagram has just crossed 1 million followers, while its GIF strategy has been highly effective, only days ago crossing the 10 billion views chasm.
Schnetzler thinks it’s a little bit sad that he gets such praise, when it just highlights how little effort other PFP projects put into trying to grow their brands.
“Everyone’s been saying that their NFT project is a brand, they have hundreds of millions of dollars that they raised from the community and venture capital at ridiculous valuations. Yet none of them are actually doing the basics of building a brand,” he says.
“Some people really sing my praises, and it’s actually pretty sad because I do 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 are not doing when they have 10-20 times the resources and 2-3 times the experience is pretty shameful.”
Finding the entrepreneurial spirit
Despite only being 25 years old, Schnetzler actually started his entrepreneurial journey over a decade ago. Growing up poor and bouncing around couch to couch at friends’ places, Schnetzler says he needed to start earning at a young age.
“I’ve really been out of school working for 10 years and it’s pretty crazy to say, but that’s what it’s been,” he says, noting most people don’t even start working until they finish college in their 20s
“Then you do 10 years after you leave college and you’re 33, and then people start to see 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 chilling out or having a childhood where I could just go home and play video games and not worry about anything. I was forced to go work and figure things out.”
Character building versus brand building
To date, most PFP projects are built around a centralized character with a variety of different traits to give each NFT a slightly different look and feel. Take the OG collection CryptoPunks, the Bored Apes, and it is also true for the Pudgys. But it’s not the case for Gary Vee’s VeeFriends, which boasts 270 individual characters.
Schnetzler believes character building around one individual character is the easier of the two options.
Read also
“At the end of the day, I think Gary is trying to tackle a tougher challenge. It’s part of the cards I was dealt and have, and he created his cards. I think he’s doing a great job with VeeFriends. I think ultimately he has to create familiarity. Creating familiarity around a character is a lot easier than creating familiarity around a brand,” says Schnetzler.
“They’re two different things and because his universe isn’t predicated on one character, but a multitude of different characters and different animals in different shapes. He is betting and taking a shot at the brand, and the brand name versus the character.”
“I’m going after the character first and then worrying about the brand because I believe there’s enough people that love penguins and few enough penguin brands out there.”
A brave new world – Walmart pallet program
In September this year, Pudgys announced a groundbreaking deal with retail giant Walmart that saw Pudgy Penguin physical toys available for sale and in prominent locations in over 2,000 stores throughout the U.S.
“The pallet program is one of the most prestigious places you can get because it gives prime real estate to people walking the floor. It signals Walmart’s belief in the brand and their belief in NFTs and Web3 being a vertical for their retail locations,” says Schnetzler.
“If that can become a general norm in the world’s biggest retailer it gives us a real shot to succeed. It’s one thing to be in the crevices of the toy shelf, it’s another thing to be front and center for everyone to see. That program doesn’t happen for brand-new brands. It’s normally a program for Barbie, Teenage Mutant Ninja Turtles or people that have movies and TV shows off the backs of their releases.”
Building a legacy brand with no playbook
One of the most common questions consistently thrown at a PFP project is “how do you drive value back to holders?”
In response to criticism about its toy product extension, Schnetzler laid out his plan on how Pudgy Penguins are thinking about value accrual to holders using a classic funnel diagram.
“The funnel is not something that I’ve really invented. I mean, you can throw Star Wars and any other big legacy IP onto that funnel, and that’s the strategy. The idea, though, with NFTs is the value of the first edition collectible is a huge anchor to the business. If you put any first edition collectible at any legacy brand on the bottom of that funnel, it still makes the most sense,” he says.
“I want to build a legacy brand, the likes of a Hello Kitty, a Star Wars and a Pokemon.
That’s easier said than done, he admits, saying there’s no roadmap to follow for a PFP project.
“Hello Kitty took 60 years to build. My holders don’t have 60 years for me to go build something. If I lose momentum and traction within the holder base, then I ultimately lose everything because I don’t believe you can build a successful Web2 business while your Web3 business fails.”
Rapid-fire Q&A
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 that I found huge inspiration from, you can kind of tell it in my leadership style, is really Steve Jobs.”
The intense pressure of a founder
“It’s not easy, but it’s also not the worst thing. One of the reasons why we got here is because of the community. I think I’m in a great situation because I bought the project and I didn’t take any money from them. The nature of people who hold Pudgy Penguin PFPs, they’re good people.”
Read also
“You can’t really be an angry, miserable person and then go click buy on a Pudgy Penguin. The art kind of creates a culture that already filters a lot of that nonsense out. Now, I empathize with a lot of other people who I see go through the chaos.”
What you would tell a Mom about Pudgys
“What I would tell a Mom is, ‘hey, this is a great value proposition for your son or daughter. This is way more fun than any other $10 toy.’”
“Why? Because they unlock a bunch of things in the digital world that not only entertain them when they go to bed or when they’re 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 bang for buck special.”
Were the Pudgy gifs planned?
“The gifs were totally random. But the second we saw it, we quadrupled down, but it was totally random in the beginning. It was a sheer accident but a happy accident.”
“I don’t need people to know about Pudgy Penguins now, but you want to know something when NFTs are the talk of the town again, and all those people have been using Pudgy gifs the whole time, that’s going be a really good source of credibility for them once everyone starts to want to buy NFTs.”
What’s your position on royalties?
“It shouldn’t be 0% and it shouldn’t be 5%. I think it’s somewhere in the middle. I think the number is between 1% and 1.5% is where I think the enforceable royalty should stand. The reason being is because you just have to incentivize 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 I get high doing it. I recommend it because it’s the quickest way you can get high for free. I’m also setting up my cold plunge now.”
Where are Pudgys three years from now?
“We’re the face of NFTs, we’re the face of Web3. We have brought the most value to holders emotionally and fiscally. Three years from now we’re probably launching a movie. The movie is close.”
Links:
Website: http://www.pudgypenguins.com
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Politics
Sir Keir Starmer vows to defend budget decisions ‘all day long’ as farmers slam ‘disrespectful’ PM
Sir Keir Starmer has said he will defend the decisions made in the budget “all day long” amid anger from farmers over inheritance tax changes.
Chancellor Rachel Reeves announced last month in her key speech that from April 2026, farms worth more than £1m will face an inheritance tax rate of 20%, rather than the standard 40% applied to other land and property.
The announcement has sparked anger among farmers who argue this will mean higher food prices, lower food production and having to sell off land to pay for the tax.
Sir Keir defended the budget as he gave his first speech as prime minister at the Welsh Labour conference in Llandudno, North Wales, where farmers have been holding a tractor protest outside.
Sir Keir admitted: “We’ve taken some extremely tough decisions on tax.”
He said: “I will defend facing up to the harsh light of fiscal reality. I will defend the tough decisions that were necessary to stabilise our economy.
“And I will defend protecting the payslips of working people, fixing the foundations of our economy, and investing in the future of Britain and the future of Wales. Finally, turning the page on austerity once and for all.”
He also said the budget allocation for Wales was a “record figure” – some £21bn for next year – an extra £1.7bn through the Barnett Formula, as he hailed a “path of change” with Labour governments in Wales and Westminster.
And he confirmed a £160m investment zone in Wrexham and Flintshire will be going live in 2025.
‘PM should have addressed the protesters’
Among the hundreds of farmers demonstrating was Gareth Wyn Jones, who told Sky News it was “disrespectful” that the prime minister did not mention farmers in his speech.
He said “so many people have come here to air their frustrations. He (Starmer) had an opportunity to address the crowd. Even if he was booed he should have been man enough to come out and talk to the people”.
He said farmers planned to deliver Sir Keir a letter which begins with “‘don’t bite the hand that feeds you”.
Farmers’ tractor protest outside the Welsh Labour conference in Llandudno, North Wales
Mr Wyn Jones told Sky News the government was “destroying” an industry that was already struggling.
“They’re destroying an industry that’s already on its knees and struggling, absolutely struggling, mentally, emotionally and physically. We need government support not more hindrance so we can produce food to feed the nation.”
He said inheritance tax changes will result in farmers increasing the price of food: “The poorer people in society aren’t going to be able to afford good, healthy, nutritious British food, so we have to push this to government for them to understand that enough is enough, the farmers can’t take any more of what they’re throwing at us.”
Mr Wyn Jones disputed the government’s estimation that only 500 farming estates in the UK will be affected by the inheritance tax changes.
“Look, a lot of farmers in this country are in their 70s and 80s, they haven’t handed their farms down because that’s the way it’s always been, they’ve always known there was never going to be inheritance tax.”
On Friday, Sir Keir addressed farmers’ concerns, saying: “I know some farmers are anxious about the inheritance tax rules that we brought in two weeks ago.
“What I would say about that is, once you add the £1m for the farmland to the £1m that is exempt for your spouse, for most couples with a farm wanting to hand on to their children, it’s £3m before anybody pays a penny in inheritance tax.”
Read more:
Ex-Labour adviser suggests doing to farms ‘what Thatcher did to coal mines’
Farmers ‘could block ports and disrupt food supply’
Welsh farmer Gareth Wyn Jones
Ministers said the move will not affect small farms and is aimed at targeting wealthy landowners who buy up farmland to avoid paying inheritance tax.
But analysis this week said a typical family farm would have to put 159% of annual profits into paying the new inheritance tax every year for a decade and could have to sell 20% of their land.
Keep up with all the latest news from the UK and around the world by following Sky News
The Country and Land Business Association (CLA), which represents owners of rural land, property and businesses in England and Wales, found a typical 200-acre farm owned by one person with an expected profit of £27,300 would face a £435,000 inheritance tax bill.
The plan says families can spread the inheritance tax payments over 10 years, but the CLA found this would require an average farm to allocate 159% of its profits each year for a decade.
To pay that, successors could be forced to sell 20% of their land, the analysis found.
Trump’s administration could push DeFi from niche to mainstream, with crypto advocates eyeing potential pro-crypto policy shifts.
A former Conservative MP has said he felt “enormous guilt” when he found out he was the victim of a Westminster honeytrap scandal.
William Wragg resigned from the parliamentary party in April after he admitted giving out fellow politicians’ phone numbers to the suspected perpetrator of the sexting scam.
He said he felt threatened and pressured by the “catfish” after exchanging explicit photos with them.
Mr Wragg divulged the numbers to what he thought was a real person on a dating app, amid fears that the intimate images of himself would be leaked.
The former Tory party whip said he first saw news articles about the scandal when he was on a train.
The 36-year-old told the BBC: “My stomach just dropped.
“When I found out some of the things that had been going on, I just felt enormous guilt, enormous remorse.”
After the former Hazel Grove MP handed over the personal information, the catfish told Mr Wragg to vouch for their identity with their next potential victims, with the catfish telling their fresh targets they were a former researcher for Mr Wragg.
Mr Wragg agreed and this is what he feels “the most regret for” as it was “deceitful”.
Pic: PA
Panic attacks
After he was allegedly blackmailed, Mr Wragg started having panic attacks, with instances of yelling, crying, and swearing shocking his sleeping flatmates.
Police are investigating the scandal with at least 12 men with links to Westminster believed to have received unsolicited messages from the aliases “Charlie” and “Abi”.
The fake accounts were allegedly part of the scam to get MPs and other people in politics to send explicit images and other private or sensitive information.
Unlike others who were approached by the catfish accounts, Mr Wragg approached “Charlie” himself after spotting the profile on gay dating app Grindr.
And he thought the account was a real person before exchanging explicit photos with the catfish.
Suicidal thoughts
When the scandal broke, the humiliation and shame became too much for Mr Wragg.
He recounted photographers and the media camped outside his parents’ house, which is where he went to as he began to have suicidal thoughts.
Shortly after receiving medical attention, he returned to Westminster to resign as Conservative whip and from his posts on two parliamentary committees.
He had already announced he would not run in the next general election.
Keep up with all the latest news from the UK and around the world by following Sky News
Man detained
In June, a member of the Labour Party aged in his mid-20s was apprehended in Islington, north London, on suspicion of harassment and offences under the Online Safety Act.
He has since been released on bail.
Anyone feeling emotionally distressed or suicidal can call Samaritans for help on 116 123 or email jo@samaritans.org in the UK.
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