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Are we ever going to see NFTs boom again? Luca Netz thinks so.
The Pudgy Penguins have become one of the most recognizable brands in crypto since Luca “Netz” Schnetzler took the helm in early 2022, ultimately becoming the CEO of Igloo Inc. and, later, the co-inventor of the Ethereum L2 Abstract.
“I think you’ll see mania again,” Netz told me in an interview. “I think you’ll see a version of 2020, 2021, happen. I think you’ll see that again.”
Netz also has the hot take that gaming is even more likely to pop in a big way. “I’m even more certain about gaming than I am NFTs,” he said.
While the Penguins began as an NFT collection, they’ve since expanded well beyond that with games, meme-inspired social videos, children’s books, and plush toys.
Believe it or not, they’re not trying to make a toy brand. It’s a bigger IP play Netz sees as competing with memes like Doge and Pepe in the short-term — and giants like Pokémon or Hello Kitty in years to come.
Part of the appeal from a brand standpoint is that physical toys can capture a different part of someone’s life and maintain a brand presence when all screens are off. They can also be intergenerational, and hold meaning for adults and kids.
“It’s not even a great revenue business, to be fair. It makes a lot of top-line revenue, but it’s not, you know, I didn’t buy Pudgy Penguins to build a toy business,” he said. “If I made no money on the toys, I’d be okay with it. If I lost money on the toys, to a certain extent, I’d be okay with it. Now we make money on the toys, and so it’s great.”
Netz bought the Penguins brand three years ago for 750 ETH, or about $2.5 million, at the time ($2.9 million today).
Chatting with Netz, there’s a determination and a confidence that suggests he’s not going to stop until “everybody in crypto” owns some piece of Pudgy Penguin IP and some PENGU, the brand’s affiliated memecoin.
Tapping into the existing crypto-native audience and their families remains one jumping-off point, while expanding beyond into broader consumer markets is another prong of the plan.
Igloo Inc., which owns Pudgy Penguins, Abstract, and the Overpass NFT licensing platform, is “on track” to make $50 million in revenue this year.
“I think the opportunity in the open ocean in crypto today is consumer. I’ve been saying this for a long time,” Netz said. “The metrics and the data doesn’t read the same, but I think you take a billion dollars in revenue in consumer and a billion dollars in revenue in DeFi, and I think the consumer founder’s making five times more money.”
