Posterous

Entrepreneurs: Sachin Agarwal, 29; Brett Gibson, 29; Garry Tan, 29
Funding: $5.1 million from Redpoint Ventures, Trinity Ventures, Y Combinator, and angel investors

Posterous lets users quickly create their own Web sites, as well as post text, photos, and video to sites such as Facebook and Flickr (YHOO) by simply e-mailing them to Posterous. "People want to create Web sites, use Facebook and Twitter, but for most people it's too hard," co-founder Agarwal explains. The service is free, but the startup plans to roll out a paid version that will offer more storage later this year.

Toughest decision: "Recently we had to decide whether to sell our company or stick it out and make it huge," says co-founder Tan. "We decided that we believe in the vision and if we sell our company, it'd be a huge mistake."