Dear Smurfs’ Society holders, members, and frens,

Building one of the most ambitious NFT projects in the dead of a bear market was never going to be easy. Most people wouldn’t have thought of investing over two million euros right after the crypto crash of 2022. But that’s exactly what we did. Confident in our bold idea, we pursued talks with the Smurfs' license holders despite the bear market. We wanted to build an NFT collection the likes of which no one had ever seen, and we weren’t going to sit back and wait for the market to be more favorable.

So, in the summer of 2022, The Smurfs’ Society was born. What started as a small team with a big idea quickly turned into a team of 25+ Web3 believers passionate about bringing the Smurfs’ values to the world of NFTs and crypto. Our goal has always been to build a community around collective interests and individual rewards. We set out to produce the highest-quality NFT collection ever with one of the most famous IPs because we believe in the value of brands and art. We have poured our heart and soul into delivering The Smurfs’ Society.

We began the sale of our NFTs during a market downturn, and we admit our returns are still far from our expectations. But we want to reflect on all that we've accomplished and delineate our future focus along with some of the necessary adjustments we'll need to make moving forward.

Facing the Market Downturn

Like many NFT projects today, some of the difficulties we have faced can be attributed to the market downturn. The broader crypto bear market, economic uncertainty, oversaturation, "cash grab" projects, and limitations in utility and long-term value created a challenging environment to build in.

PFP collections in particular relied heavily on artificial scarcity and social status as their core value proposition. But as the hype faded, their weakness in providing lasting utility, community, and exclusivity was apparent. Going forward, PFP projects will need to focus more on creating authentic communities and member benefits beyond just profile pictures.

Promising the Moon

We recognized a changing market and the opportunity to bring something different. From the very start, we have been ambitious. We saw endless possibilities and exciting ways to deliver more value to an NFT collection than ever achieved. The Smurfs were a perfect canvas for our creativity, with rich lore and diversity of character that lent themselves well to building a community. We let our imaginations run wild and started developing from day one. At the project's core, we focused on innovation, artistic quality, and utilities for holders. We are proud to have achieved many of our goals, most notably:

• The game: The first ever gamified on-chain allow list mechanism. In 3 months, our crafting game saw over 80k wallets connect, 3 million polygon transactions, and a coveted spot on DappRadar’s top 100 list.

• The collection: 10,000 fully 3D-rendered PFPs for 200 individual characters and contributions from renowned artists.

• A robust ecosystem of collabs: We have partnered with some of the biggest names in the Web3 space, including Lens, ZenGo, Habbo, Mecha, Oxya, Tropee, Rarible, Blvck, XMTP, Phaver, Orb, Polygon, The Sandbox, and many more.

• An unrivaled list of utilities: Building on the concept of “collective and individual rewards,” we worked hard to create unique utilities for Smurf holders that went beyond votes:

  • For all Smurf holders: Access to our crafting game, access to the upcoming Web3 treasure hunt, access to partner perks (Blvck, Habbo, Mecha, Phaver, MetaFight, etc.), with much more planned.

  • For individual Smurf characters: From the Lone Smurf statue giveaway to the Detective Smurf quest worth $1,000, we set out to provide Holders with unique rewards aligned with their particular Smurfs. For a list of perks for individual characters, see here.

With the incredible traction around our game, a visually stunning collection, and a marketing strategy that leveraged our partnerships with big names in Web3, we were confident the Smurfs would be the next Blue-Chip PFP.

Accepting the Financial Reality

Because we believed so much in the project, we invested heavily from day one. Unlike traditional PFP collections that wait to build until after their genesis mint, relying on hype and FOMO, we wanted to demonstrate our determination to bring innovation and utility to the world of NFTs before the mint. So we poured our resources into the features above, focusing on the tech, storytelling, collabs, and the quality of the collection itself. All before we minted a single Smurf.

We expected our initial investment to pay off during the sequential mint phases. People would see the level of quality that went into the collection and would mint because they believed in our ability to deliver something innovative in the space, not just an unsubstantiated dream built on speculation.

We were happy with the Hacker Smurf auction, setting a high bar for the entire collection. But for the rest of the collection, we didn’t want to choose an arbitrary mint price, so we thought it would be best to let the market decide based on what we had delivered so far. However, the bucket auction, which was intensively developed in-house with the support of Rarible, did not go according to plan. While we had some big investors show interest, the vast majority of our community did not participate in the auction.

In hindsight, the way we structured the allow-list crystals to be directly tied to the bucket auction backfired. Community members who owned crystals and wanted to mint a Smurf had no interest in participating in the bucket, as it would drive up the mint price. Crystal holders who wanted to sell their crystals for more than they invested wanted a high mint price but weren’t necessarily interested in holding an actual Smurf, so they had little motivation to place bids.

The clearing price from the bucket auction (0.173 ETH) put the cost to mint out of reach for many of our closest followers, which equated to low sales during the crystal mint. Despite having 20k followers on Discord with an active community and 60k followers on Twitter, we only minted around 5k Smurfs out of the original 10k supply. To be completely transparent, combined with the results of the bucket auction, we fell short of the expected sales needed to cover existing costs and refinance the project as planned...

Without disclosing the cost of obtaining the IP rights (which we legally cannot do), here is a breakdown of the project’s cost structure.

In total, we have spent more than 2.5M euros in cash and exhausted our budget. These numbers don’t take into account the time invested by our founders, who have not been compensated financially throughout the project.

Our lower-than-expected sales meant we had to greatly reduce our budget and team right when we planned to start building. This was devastating; our team had become very tight-knit over the months, and we lost many of the members who were driving forces behind the project. Some members have stayed on as volunteers, continuing to invest their time and energy because they still strongly believe in what we are building.

Putting Some Dreams on Hold

As you can expect, such a huge reduction in resources (both financially and in terms of manpower) combined with the changing NFT market has meant we have had to cut costs and focus our attention on a few key areas to keep the project alive. Sadly, this has meant putting some of our promises on hold. At this time, we are unable to deliver a handful of features, most notably: the alliance collection (a more affordable and inclusive collection that was going to be tied to the game and DAO); Fusion NFTs (for Hacker and Bucket Auction winners); a bigger, more complex version of the game; our intricately structured DAO; and more.

This does not mean we will never deliver on these promises, as we still hope the upcoming sales will bolster support and resources. We are still ambitious and believe that the quality of the collection speaks for itself. As we bring more Web2 users into the fold, the Smurfs will undoubtedly appeal to new collectors. But we have to be more strategic now with how we use our resources.

Focusing on the Bigger Picture

The poor financial results, changing NFT space, and continuing bear market have forced us to pivot. While many degens in the Web3 space might feel betrayed by any collaboration with Web2 models, we strongly feel that making NFTs more mainstream and accessible to more users can breathe much-needed life and resources into the market. With that in mind, we are now focusing our attention on three pillars that combine Web2 and Web3 audiences:

• A sale of physical merchandise that will include a trading card game based on our beloved NFTs. While we can’t disclose many details yet, this sale will be held on a large marketplace and is expected to bring Web2 users into the world of NFTs. It is clear that the Smurfs has a huge following in the Web2 world, and we are confident the brand has the potential to perform well among other Blue-chip NFT collections. [Estimated delivery: fall 2023]

• The largest Web3 treasure hunt in collaboration with a leading partner in the space. Staying true to our Web3 roots, Legendary Smurfs will have access to this exciting opportunity that will be highly promoted by our partner. [Estimated delivery: Fall 2023]

• A relaunch of our innovative on-chain game that will be reserved for holders and a few select partners. This game is one way we are giving back to our community and those who have supported us throughout the project, and will allow holders to play to earn ETH. Large prize pools can also reignite interest in the collection. [Expected Delivery: the first week of August 2023]

With these three pillars, we hope to increase the visibility of the Legendary Collection and the Smurfs NFTs in general. If we are able to reach our targets, then we can continue to build and deliver on our other promises: our DAO, the much bigger & improved version of our crafting game, and the alliance collection are all still works in progress (with the game being 85% complete in terms of development).

Calling On Our Community

Above all else, we want to remind readers that we have always tried to keep the community at the heart of the project. We designed a new WL system that made joining the project more fun for the community. We delivered a collection that brought real artistic value, ensuring each NFT was a work of art that the community could be proud to own. We have attempted to bring unrivaled utilities to holders with big names and creative rewards that no other collection has dared to promise. All this and more because we love our community and want to give you a reason beyond FOMO to own a Smurf.

We are immensely grateful for the support, investment, and energy of all the Smurfs’ friends. We know many of you have already used your time and money to share suggestions with us and promote the project, and we are grateful for that. We are still open to any ideas or initiatives that could offer creative alternatives to this situation, keeping in mind our limited resources.

We know not everyone will be happy with this news, but we will continue doing everything possible to deliver our promises to the community. The Smurfs, like Web3, will always be about community, so we're open to discussing, voting, and sharing. We would love to give you, the holders, more power now and continue our dream of creating a more decentralized collection. Every Smurf has its place in the village, and every one of you has your place in this community.

We might not be invincible, but together, the Smurfs will always have a future.