It could easily be distributed in a fashion similar to say bittorrent. Whatsay each node contains it's own users's data, as well as the data from several other users. When you look for someone, your node looks for the nearest node containing that person's data. Theoretically, something like this could be impervious to small scale outages. That would give it an edge even on Facebook.
This seems like a niche for social networking, rather than a alternative to FB.
Social networks works because they are up and running 24/7. If the data is on my computer how will others access it if I turn off my computer ?
If you ask me, they are doing a great viral buzzing money funding. This is like the 5th post I see on the web less than two hours about this.