Pudgy Penguins Bucked the NFT Crash—Now It’s Raised $9 Million

Pudgy Penguins, an Ethereum NFT mission that surged amid the 2021 bull run after which toppled into chaos, was bought by a serial entrepreneur a couple of yr in the past and given a second life—proper because the market collapsed. However the cartoon birds have persevered, and now the workforce has raised funding as its ambitions develop.

At present, Pudgy Penguins introduced that it has raised $9 million in seed funding in a spherical led by early-stage funding agency 1kx, with participation from Massive Mind Holdings, Kronos Analysis, Outdated Vogue Analysis, CRIT Ventures, and the founders of LayerZero Labs, per a launch.

The mission launched in July 2021, simply because the NFT market began placing up billions of {dollars}’ value of buying and selling quantity every month, and Pudgy Penguins’ rise was propelled partly by a viral story in The New York Occasions.

However the preliminary buzz didn’t final, and by early 2022, the group was in disarray amid controversy over a co-founder’s previous Web3 actions and plans by some NFT holders to interrupt away by “wrapping” their Penguins as one other token. Pudgy costs fell sharply amid the drama.

Luca Netz, a serial entrepreneur, bought the mission IP outright from the founders in April 2022 for $2.5 million, and informed Decrypt that Pudgy Penguins didn’t have the tens of millions of {dollars}’ value of funds that some NFTs initiatives and startups had banked through the bull run.

“After we purchased it, we had no cash within the financial institution,” he mentioned. “And we knew that.”

Netz mentioned that Pudgy Penguins “wanted an actual operator” to steer the ship. Quickly after, nevertheless, general NFT gross sales quantity plummeted amid a crypto market crash, producing fewer creator royalties from secondary market gross sales and diminishing broader enthusiasm within the house. His workforce needed to be “actually scrappy” to develop the mission amid these circumstances.

Many NFT initiatives have misplaced appreciable worth over the past yr. The Bored Ape Yacht Membership, for instance, fell from a peak beginning value of about $429,000 (152 ETH) in late April 2022 to a present value of $82,600 (45 ETH). However Pudgy Penguins has bucked that development, rising from $4,365 (1.55 ETH) to  $8,170 (4.44 ETH) in the identical span.

Amid that market-defying development, Pudgy Penguins has launched bodily toy initiatives and different merch and constructed an advisory board with leaders from Meta and Hasbro. The mission not too long ago mentioned that it signed with main Hollywood expertise company WME to pursue media initiatives and past, and it has generated some $250 million value of whole buying and selling quantity so far.

And whereas these strikes have set Pudgy Penguins as much as discover mainstream plans, the mission has additionally grown its cachet amongst NFT die-hards, little doubt helped partly by being one of many uncommon profile image (PFP) initiatives that has truly gained worth amid a broader freefall.

From his vantage level, Netz mentioned that he understands what customers need from the mission. The primary NFT he ever purchased was a Pudgy Penguin, and he informed Decrypt that he then went on to commerce tens of millions of {dollars}’ value of NFTs after that.

Netz later bought the Pudgy IP considering that it had all of the items to drive each a Web3 group and mainstream extensions starting from merchandise to leisure media. It’s family-friendly and inclusive, he mentioned, with a fervent group of NFT holders behind it.

Many NFT initiatives discuss creating main IP—for Netz, attaining that purpose would imply making certain that Pudgy Penguins has broad “affect.” Pudgy Penguins has notched over 3 billion views on its official GIFs and tens of tens of millions of Instagram views, and now the seed funding and obvious WME deal might assist it attain a good wider viewers.

“I take a look at the Pudgy Penguin like an influencer,” Netz mentioned. “This character is transcendent in its capacity to get the place we would like it to be.”