San-Francisco startup WooMe publicly launched its U.S. and U.K.-based online introduction service yesterday, with the tagline, “WooMe is introducing the world, one person at a time.” The company, which is the first to take speed dating online, predicted the market could reach $10 billion by 2008.

Since the company was selected to debut its Alpha test at the TechCrunch40 conference in October, it has been preparing the site for action, using its $1.9 million in funding from investors, which include Joost founder Niklas Zennstrom and Skype founder Nicolas Zennstrom.

In its first day of business, the site attracted so much traffic that the server came down shortly after sessions began at 7 p.m. PST. WooMe executives said they would provision the required server capacity to handle much greater traffic loads, so that the site would be fully functional for tonight’s onslaught of eager visitors.

“While we took many precautions planning for a spike in volume to our site, we never imagined in our wildest dreams the type of response we had this evening,” the WooMe team said in its blog.

The service, designed to attract the short attention span of the younger generation, could be considered online video speed dating. Three guys and three girls, or some combination therein, enter a video chat room and take turns having one minute, one-on-one conversations on topics either they selected or that were predetermined.

While users upload a picture and create a quick profile detailing their body type and looks (from “not important” to “smoking”), the Webcam means instant verification. To conduct the site’s free conference sessions, it uses flash video conferencing within a browser, and the sessions run on live audio-video, although only audio can be selected. Based on the idea that voices can be revealing, participants never type to one another, although they can add one-word tags of their impressions of their potential dates, creating tag clouds for that person.

After a five-minute session is up, users select either “I’m wooed” or “no thanks” for each member of the conference. If one of the dates matches their “I’m wooed” selection they can connect and receive each other’s contact information for the low fee of $1. Unlike other online dating services, WooMe hopes to generate revenues through sponsorships, not membership fees. The service will also keep track of users’ interests to eventually promote relevant video ads that play while users are waiting to connect with someone.

The site isn’t designed as a hard-core dating application, however. The environment is supposed to be informal, like a bar, CEO Stephen Stokols said. The site could easily take on Craig’s List type functionality and become a way for people to meet roommates or network. The young staff of entreprenuers even used their site to interview prospective staff, with each one rating whethere prospective employees impressed them.