XuQa: It’s All A Game

XuQa, one of the me-too social networks started post-MySpace acquisition, relaunched today, turning its admittedly raunchy site into one big game. Well, a big contest actually!

XuQa members–there are currently about 800,000–play for “peanuts” by adding friends, uploading pictures, winning in one of the sites’ poker rooms, watching ads, et cetera…then spend the peanuts on in-game items.

They’re not your typical perks–you can buy the ability to see who’s viewed your profile, or pay to spike the drink of a poker rival to inhibit his card-playing skills. Active users move through ten levels, for the ultimate prize of exposure on the XuQa home page and $1000 cash. Four testers are already at level 9. (Think we are getting too detailed? See this ridiculously intensive Wikipedia entry.)

XuQa’s peanuts are a take-off on the acorn system of Cyworld, the massively popular Korean social network that just launched in the U.S. But instead of charging users for peanuts XuQa wants to make them sit through ads and sign up for affiliate programs. XuQa founder Murtaza Hussain contends this will be more effective than MySpace’s display ads, which are seen as low-value because they’re not well integrated into the way people use the site. But that argument seems a bit outdated now that Google just essentially bought $900 million worth of ads on MySpace.

XuQa (the name is derived from “hookah”) was kick-started last year when Hussain, Ali Moiz, and Prosper Nwankpa dropped out of Williams College to take $1 million from BV Capital. They have raised $1.3 million total and have 25 employees, five in San Francisco and 20 in Karachi.

This is one of those sites that defies over-25 convention. In March, the guys at alarm:clock mocked XuQa’s anti-establishment tone, saying the company would never get funding. BV Capital’s Tom Gieselmann openly admitted to me he had never joined a social network. He is leaving it up to the kids to know their audience. Good Call!