I read the landing page, clicked about, looked at the first page of the API docs and it's still not really obvious to me what it is for or how it's actually used.
What problem is it solving? Standard web backend for common social media platform stuff?
Basically, yes it's, you can make own online community, or niche social network for your users/products. But this is very useful to make unique social app based on an open source framework.
If you want to launch startup then social interaction between people is very important and Elgg allows you to do it quickly. In addition, it's very secure code with wide features for growth and integration with other applications.