Pudgy Penguins' CEO on Building a Sustainable Web3 Enterprise

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In the volatile world of NFTs, survival is rare — and sustained success even rarer. While most projects fade into obscurity after controversy or market downturns, Pudgy Penguins has defied the odds, transforming from a nearly abandoned collection into one of Web3’s most compelling comeback stories. Under the leadership of CEO Luca Schnetzler, the brand is redefining what it means to build a sustainable Web3 enterprise by blending digital innovation with real-world impact.

The Turnaround That Changed Everything

When Pudgy Penguins first launched during the 2021 NFT bull run, it captured the attention of collectors and investors alike. But its momentum stalled after allegations surfaced that founder Cole Thereum had misused project funds — rumors that sparked fears of a rug pull and led to a collapse in community trust. A failed leadership transition only deepened the crisis.

Then came the turning point: Luca Schnetzler, a longtime supporter and holder of Pudgy NFTs, stepped in and acquired the collection for 750 ETH (approximately $2.5 million at the time). Rather than erase the past, Schnetzler chose to embrace it — framing the project’s turbulent history as a testament to resilience and renewal.

“With everything going on in the NFT and crypto space, we need to make NFTs and crypto a little bit more approachable.”
— Luca Schnetzler

This philosophy became the foundation of Pudgy’s revival strategy: transparency, inclusivity, and real-world utility.

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Expanding Beyond Digital Collectibles

One of Pudgy Penguins’ boldest moves has been its strategic expansion beyond the digital realm. Recognizing that long-term sustainability requires more than speculative trading, the team is actively licensing its intellectual property (IP) for physical products.

In early 2023, Pudgy launched a line of plush toys in partnership with PMI Toys, a global manufacturer specializing in children’s products. This was followed by collaborations with Green Kids Club on a series of children’s books featuring select Pudgy characters. These aren’t just merchandise drops — they’re carefully curated brand extensions designed to appeal to mainstream audiences who may not yet understand blockchain.

Holders can submit their NFTs for consideration in upcoming product deals. Once selected — such as a Pudgy wearing a polar bear hat for a plush release — the owner earns 1/13th of the revenue generated throughout the life of the agreement. To date, over a dozen Pudgies have been licensed for toys, and five have been chosen for book features.

“We have over 8,000 Penguins, and every time we open up one of these deal submissions, we get hundreds of applications within the first hour,” Schnetzler shared. “People really want to see their IP succeed — they just don’t always have the connections to make it happen.”

By opening up commercial rights and sharing revenue, Pudgy empowers holders while ensuring brand consistency — a model that could set a new standard for community-driven IP development.

Bridging Web3 and Mainstream Culture

Pudgy Penguins isn’t just building products; it’s building perception. On Instagram, the brand maintains a vibrant presence focused entirely on positivity, mental health affirmations, and family-friendly content — with no mention of NFTs or blockchain.

This intentional separation allows Pudgy to reach audiences outside traditional Web3 circles. Followers engage with uplifting messages like “You are capable” or “Today is full of potential,” unaware they’re interacting with an NFT brand — until they click through and discover the deeper ecosystem.

“We saw so many projects relying solely on Twitter and Discord engagement farming,” Schnetzler explained. “That worked during the bull market. But we decided to cast a wider net — one where people fall in love with the brand first, then learn about the technology behind it.”

This approach makes Web3 more accessible, reducing friction for newcomers and positioning Pudgy as a gateway rather than a niche collectible.

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Strengthening Community Through Transparency

Trust is hard-earned in today’s crypto climate. To rebuild it, Pudgy prioritizes radical transparency. The team shares updates frequently — even for minor developments — keeping holders informed and involved.

Eleven developers currently working on Pudgy projects are NFT holders themselves, contributing code and ideas directly to new initiatives. This insider participation reinforces authenticity.

“The community knows we’re actually building things because they’re helping us build them.”
— Luca Schnetzler

Additionally, proceeds from key events feed back into the ecosystem. For example, all profits from Sotheby’s Snowed In auction of rare Pudgy NFTs — including iconic pieces like #4609 and #7315 — go directly into The Cozy Horizon Fund, which finances community events like NFT Winter during Art Basel.

Participants also receive a soulbound token from Sotheby’s as proof of participation — a novel use of non-transferable digital credentials that enhances exclusivity without speculation.

Aligning with Purpose-Driven Partnerships

Sustainability isn’t just financial — it’s ethical. Ten percent of Sotheby’s auction proceeds benefit Oceanites, a nonprofit dedicated to Antarctic penguin research and climate science. This alignment between brand identity (penguins) and environmental stewardship strengthens public trust.

“We’re always looking for charity opportunities that reflect our values,” Schnetzler said. “Whether it’s climate action or mental health advocacy, if it resonates with our mission, we’re interested.”

These partnerships extend Pudgy’s influence beyond commerce, reinforcing its role as a socially conscious brand in both physical and digital spaces.

Frequently Asked Questions

Q: What makes Pudgy Penguins different from other NFT projects?
A: Unlike many NFTs focused solely on speculation, Pudgy emphasizes real-world utility, community ownership, and mainstream accessibility through toys, books, and positive branding.

Q: Can any Pudgy holder license their NFT commercially?
A: Yes — holders can apply to license their NFTs for official product deals. If their Pudgy is selected, they earn ongoing revenue shares. For ventures exceeding $500K annually, a formal licensing agreement with the team is required.

Q: How does Pudgy involve its community in decision-making?
A: Through transparent communication, holder-led development roles, and open submissions for product features, Pudgy ensures community input shapes its evolution.

Q: What happened to the original Pudgy Penguins team?
A: After allegations of fund misuse and failed leadership transfer in 2022, CEO Luca Schnetzler purchased the collection and revitalized the project with a focus on trust and long-term growth.

Q: Are Pudgy Penguins still valuable as investments?
A: While market value fluctuates, Pudgy's shift toward tangible products and broad cultural relevance adds enduring value beyond short-term trading.

Q: How is Pudgy making Web3 more approachable?
A: By focusing on universal themes like positivity and family-friendly content — especially on platforms like Instagram — Pudgy introduces blockchain concepts gradually and organically.

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Core Keywords

By merging emotional resonance with strategic business development, Pudgy Penguins exemplifies how Web3 brands can transcend digital hype to become lasting cultural icons. In doing so, it offers a blueprint for sustainability in an industry too often defined by volatility.