Bear Market Hall Of Fame

Web3 brands are evolving. As the industry gears up for another growth spurt, we need to shine a spotlight on the builders who really deserve our attention.

For the purpose of this article, we’ll focus on NFT projects. Let’s take a look at our “Most Likely To Succeed” founders. In no particular order…

Luca Netz [Pudgy Penguins]

Pudgy Penguins are arguably the face of NFTs in today’s market. The team’s efforts have resulted in deep market penetration. And it all started in April 2022.

The previous year, the founding team had generated lots of hype. But they got caught up in fraud and embezzlement allegations, sullying the brand's image. It looked like the Pengus were bound to go bust.

But where everyone saw a failing project, Luca, a savvy entrepreneur, saw opportunity. He purchased the project for 750 ETH ($2.5 million at the time), built an industry-leading team, and launched a comeback worthy of business school syllabuses.

You see, Luca was already building successful brands before his career as a Web3 founder. His firm, Netz Capital, had invested in direct-to-consumer (DTC), software-as-a-service (SaaS), and other tech startups.

With Pudgy Penguins, Luca focused on building the IP through storytelling. This was achieved through content flywheels and tangible value creation. Oh, and a $9 million injection from VCs.

Within the span of four months, the team delivered on several initiatives, from a dedicated media hub and marketplace to a clothing line, and from licensing deals to IRL yacht parties with celebrities. But they were just getting warmed up.

In August 2022, the team announced the first run of Pudgy Toys. November 2022 rolls around, and Pudgy Penguins collaborate with Sotheby’s for an auction of 11 NFTs. Through all of this, the collection’s floor price rises by 400%. Bear market, where?

2022 was a year of planting seeds for Luca and the Pudgy team. This year, they have lovingly watered the seeds, and their community is starting to reap the fruits. Here are some incredible stats from the last six months:

• Successful VC round (raised $9 million)

• Instagram (600K+) with 30 million+ video views

• 3 billion GIF views

• $500K first-day sales on Pudgy Toys (#1 on Amazon)

Luca’s ability to keep the Pudgy brand relevant has made millions for the NFT community as well. The Pengus have healthy price action and great volume, and the physical brand activation has opened doors for holders to earn money from traits.

Pudgy Penguins is one of the NFT brands with the most mainstream exposure. With a bull market just over the horizon, they are positioned to find even more success.

Frank DeGods [DeLabs]

Say what you will about Frank; man’s got ‘rizz for days (for the boomers in the room, it mean’s Frank is highly charismatic).

It’s this charisma that has seeped into the DeLabs community. The brand is a true embodiment of “F*ck It” culture.

33.3% royalties? “No qualms.” Bear market? “F*ck it.” Bridge to two new chains? “LFG 🔥” The whole time they’re going viral doing shoeeys on camera.

Frank and DeLabs ended 2022 on a strong note. The launch of Y00ts was a success, and their native token ($DUST) had seen some decent price action.

But there was also controversy over the decision to bridge DeLabs off Solana. Frank had a lot to prove, and the message was made clear with this tweet.

So far, DeLabs has consolidated its place as one of the world’s leading NFT brands. The floor price of the DeGods collection sits at 10.45 ETH (for reference, MAYC sits at 6.95 ETH). Y00ts is easily the #1 NFT collection on the Polygon blockchain.

Frank is building a reputation as a marketing mastermind. He understands the importance of making things sell. This is why DeLabs appeals to a wide range of people.

While DeGods represent the free-spirited OG degens, Y00ts is a — well, more youthful brand. Some of the industry’s brightest talents have adopted the dapper Yeti-inspired PFPs. No wonder it’s shaping up to be one of the most high-powered communities in Web3.

With a strong digital footprint across the internet, DeLabs is poised for discovery by the next wave of Web3 entrants. Frank recognizes this value and is building on it.

The brand’s latest offering is the DeID network. By owning an DeLabs digital asset, you are absorbed into its virtual community hubs on Discord and Twitter. This offers a triple dose of value:

• Holders gain a new way to exercise provenance by participating in the network.

• Combining both communities will provide more avenues for positive engagement.

• Both factors above will make DeLabs’ community become more exclusive.

Pons [The Plague Of Frogs]

Pons is one hell of a lemonade maker. The anonymous masked frog has been plaguing the bear market with big brain business moves (pun intended).

Just yesterday, he launched a sold-out 10k NFT collection called “Wen Utility?” After watching the market pay millions in “stupid tax,” it was really cool to see Pons pull one back for the good guys.

But none of his victories were achieved overnight. The swamp-to-grace story of the Plague community’s come up is one for the books.

Pons became a founder in August 2021. The community made a name for itself by busting scammers and pushing for a decentralized digital utopia. Admittedly, his approach was very idealistic. These days, Pons is more of a pragmatic businessman.

That’s not to say the brand is devoid of its original ideals. One of its most successful initiatives is the Frog Tank (think “Shark Tank” but with 🐸). It’s a community-driven platform that launches business ideas from members’ proposals. Notable successes include:

• Swamp Water (craft beer company)

• Non Fungible Travel (token-gated flight rewards agency)

• Acorne (secure two-way transactions protocol for OTC trades and payments)

The brand is also a solid supporter of charitable causes. Early in their journey, the frogs sponsored life-saving surgery for one of their community members. They also launched a 1,000 piece open edition collection on Polygon. All proceeds went to charity.

The Plague’s latest offering has been in the works for a while. There are no concrete details on the specifics but Pons openly talked about the process for months. This drove up the level of positive speculation on the collection.

Given Pons’ track record in Web3, the frogs feel underpriced at 0.33 ETH. As the brand leans into franchising sustainable business models, it gains exposure to new markets. When things start heating up, expect the growth to go parabolic.

Wab.eth (Pixl Labs)

The seals are a culture shift. While most NFTs brag about their superior art, Sappy Seals are undeniably cute. Wab recognized the sentimental value of this and created an NFT brand that has helped bond millions of people together.

Wab’s logical approach to value creation is inspired by his background in coding. During his days as an aspiring game developer in the UK, he built a successful trading bot. Then he gave up on an M.Sc. in Computer Science to build Sappy Seals.

The brand itself is a powerhouse of meme culture. Wab ran a campaign to pay bounties of .05 ETH for the best memes in a certain theme. And the floodgates opened. Suddenly, they were posting a meme every hour, 24/7. The seals went viral.

By February 2023, the seals’ UGC flywheel was generating a potential reach of 13 million + unique viewers. As this dashboard shows, around 34% of all NFT Twitter users had seen Sappy Seals branded content in the past day.

Source: Inspect.

This organic approach helped to strengthen the community. The holders contributed largely to the design, engagement, and feedback loops. As the brand gained more exposure, the IP grew more valuable.

Wab leaned into this by building the Pixlverse, a gaming offshoot of the Pixl Labs brand. His thesis is pretty logical: the seals will accumulate attention over time and the technological innovation of the brand is the perfect selling point.

By combining meme culture with gamification, Wab has set his sights on new audiences. The team launched a social media expansion campaign and provided content creation tools to their community to boost the brand’s reach.

Wab also created an open, welcoming culture with the Sappy Seals. His influence in the Cardano scene helped to onboard new Ethereum NFT holders who joined the seals. They also provide newbies a good point of entry into the NFT market for 0.44 ETH.

In the final month of 2022, Sappy Seals generated $764,000 in trading volume. The next month, they did $1.46 million. In addition to Pixlverse and the main NFT collection, Pixl Labs has also launched:

• Pixseals (9,994 piece open-edition on Polygon)

• Pixl Pets (15,000 piece flagship NFT collection for the Pixlverse)

• Pixlverse Items (Open-edition for Pixlverse gaming assets)

• Bitcoin Digital Artifacts (101 piece ordinals collection)

Pixl Labs is home to several brands that are backed by one of the most vibrant communities in Web3. Sappy Seals are poised to break into the mainstream using meme culture and gamified experiences.

Watch out for Part 2 next week. It’s going to be just as exciting! Don’t forget to join our Twitter community here.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.