Not only did they use an existing code base, they used one that they had developed themselves, so it's more like they 'developed an interesting demo based on their existing open source social network software in 40 hours' ;o)
Apart from the fact they used an existing code base to cut a lot of that time short it's a great example.
I think that especially including this fact it's a fantastic example. With the wealth of open source platform apps out there you can really build an app extremely quickly if you're willing to embrace constraints.
Actually the big lesson is probably that you current code base is probably reusable in lots of new ways with minimal work.
As to the site: what a brilliant idea! Risky I think - but super cool if it works out.