How Plushies Saved Pudgy Penguins from Bankruptcy

[ed]

From the brink of collapse in 2022 to a projected $50 million in 2025 revenue, Pudgy Penguins has become one of the rare NFT projects to thrive after the market crash — and it did it with a move few in Web3 saw coming: toys.

From Bear Market to Barely Surviving

In April 2022, Pudgy Penguins was at an all-time low. Its floor price had tanked, the NFT market was reeling, and a prolonged bear market loomed after the Terra collapse.

Enter Luca Schnetzler (aka Luca Netz) — entrepreneur, marketing expert, and one of the collection’s largest holders. Seeing the project on life support, Netz acquired parent company Igloo for $2.5 million in Ether.

But the situation was dire.

“This company is going to run out of money in six months if I don’t start making real money,” Netz recalls.
With Web3 revenues drying up, he turned to what he knew best: physical products.

The Toy Bet That Paid Off

Drawing on his experience as CMO of Gel Blaster and a successful dropshipping entrepreneur, Netz pivoted Pudgy Penguins into plush toys and collectibles. At first, it just kept the lights on. But by mid-2024, the company had sold its millionth toy in a year, and today, it’s a multimillion-dollar line stocked by big-box retailers like Walmart and Target.

The plushies also became a cultural brand bridge, introducing Pudgy Penguins to audiences far beyond the NFT niche.

Social Media as the Real Distribution Channel

While most NFT brands focus on X, Discord, and Telegram, Netz doubled down on Instagram, a platform his toy industry background taught him could move real-world products.

“When I go to Walmart or Target, they don’t care about NFT market cap — they care about social media,” Netz says.

As of this week:

1.9M followers on Instagram

728K followers on X

A steady stream of animated penguin reels that reinforce the brand

This mainstream visibility helped land shelf space — something many NFT projects never achieve.

Riding the Collectibles Wave

While NFT volumes slumped in 2024 and early 2025, physical collectibles began heating up. eBay credited a 6% Q2 revenue bump to Pokémon and other collector items. The Labubu craze — blind-box toys selling for thousands — further signaled that the collectible mindset was alive and well.

Netz sees a direct link:

“When physical collectibles do well, digital collectibles follow.”

That crossover is emerging in blockchain platforms like Courtyard, where tokenized Pokémon and sports cards are sold in digital “booster packs” with mystery-box mechanics.

Where Pudgy Penguins Stands Now

Floor price: Up from <1 ETH in 2022 to over 15 ETH today

Ranked above Bored Ape Yacht Club by market cap

Projected $50M in 2025 revenue

Positioned as both a physical toy brand and a digital collectible powerhouse

Pudgy Penguins didn’t just survive the NFT winter — it built a bridge between Web3 IP and the real-world collectibles economy. That hybrid model could be the blueprint for the next generation of NFT brands aiming for staying power.

[jacson4]

Pudgy Penguins is easily the best case study of execution > hype in the NFT space. Most projects doubled down on speculation and Discord “community vibes” while Luca Netz pivoted to actual products people could hold, gift, and put on store shelves. That real-world utility not only stabilized the project but also expanded the audience way beyond Web3 natives. The IG-first strategy was genius too — instead of shouting into the echo chamber on X/Discord, he met mainstream audiences where they already scroll.
The lesson for other NFT founders? Floor prices are nice, but distribution channels and brand IP matter more if you want to survive a full market cycle. Penguins went from near rug status to a $50M revenue brand. That’s insane resilience.

[Nahid10]

This is the playbook every NFT project should be studying:

IP → Products → Culture. Pudgy Penguins didn’t stop at selling JPEGs; they turned the art into toys, collectibles, and content that kids and parents can engage with.

Social proof as leverage. 1.9M IG followers is what got them into Walmart/Target. Big-box retailers couldn’t care less about “NFT floors” but they do care about cultural relevance.

Bridging markets. As physical collectibles boomed (Pokémon, Labubu, sports cards), Pudgy positioned itself at the perfect intersection of digital + physical.
No surprise they’ve flipped BAYC in market cap. Bored Apes had celebrity clout but no real product-market fit. Penguins quietly built both. If NFTs are going to have a second act, this hybrid model (digital IP + physical touchpoints) is the only sustainable path forward.