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You're pretty much right.
Basically, you try to invite as many people as possible to join the game, by linking them to your unique address (mine is 42ace). You get a point for everybody who joins through your link, half a point for everyone they invite, and points for creativity. If you fail to invite someone within a month, you get shoved off the site. Apparently there's some sort of prize for the person with the most points after about a year.
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