Review my new e-commerce model: self-serve group discounts
satjot: I understand where it can become a bit cumbersome to explain to non techies.  I would agree with the point above that the explanation does not to be as overblown as it is.  Just get the key concept out:
1) Want to buy something, but pay less?
2) Invite your friends and if a few of you buy it, everyone will save.The specific dynamics of how things work do not need to be in the pitch.  Good luck!P.S.  I've been working on something in this space.  Coming at it from a different angle, though.  Hopefully I will be able to have something to show in the next couple of months.