On Monday, Mind Candy announced that Moshi Monsters has passed the 50 million registered users mark, with 15 million of those users in North America, and is one of the fastest growing children’s entertainment brands in the world. In February, Moshi Monsters had racked up 35 million users, so in less than 4 months, the game has added another 15 million.

For those unfamiliar, Moshi Monsters is a game that enables kids to adopt one of six virtual pet monsters that they can customize in various ways and add the monster to their own virtual room, which can be outfitted with virtual goods. Kids can then navigate their way around “Monstro City”, and solve puzzles to earn virtual currency, which they can use to personalize their monsters and their personal rooms, or communicate with friends in a social networking environment.

Geared towards kids 12-and-under, Acton told my colleague Erick Schonfeld that the idea behind Moshi Monsters was to create not “just another bloody virtual world”, but a safe social network. “Instead of copying Club Penguin,” he said, “we focused more on Facebook and tried to re-imagine that for kids.” As such, there is pin board where friends can leave messages and a news feed, but there are also games, quizzes and virtual world activities.

Part of Moshi Monsters exponential growth it seems is its movement into offline products, having launched toys, books, video games, trading cards, and even a “Moshi magazine” within the UK and Australia. Today, Mind Candy is announcing that children’s entertainment company, Spin Master, has become the startup’s U.S. toy partner and that Moshi Monsters toys will launch in North America this summer via an exclusive partnership with a major retail partner (to be announced soon).

Besides the fact that Moshi Monsters books from Scholastic and Topps trading cards are already on shelf in the U.S., the company is also working on music, live tours, TV shows — and even a Moshi Monsters film. It probably wouldn’t be crazy to speculate that Moshi Monsters Happy Meals are on the way, too.

From near-bankruptcy in 2008 to 50 million registered users and $100 million in expected gross retail sales in 2011, Mind Candy and its Moshi Monsters have pulled off quite an impressive turnaround. As younger generations continue to become more and more wired, activities thought reserved for older audiences are proving to be equally as appealing and successful among younger audiences. It will be interesting to see if Moshi Monsters can follow in the footsteps of Pokemon and become more than just a passing fad. If its crossover into offline markets flies, it could be that we have the next Barney on our hands.

For more on Mind Candy and Moshi Monsters, check out TCTV’s interview with Mind Candy CEO Acton Smith here, and Paul Carr’s in depth coverage here.

Mind Candy CEO Michael Acton Smith came to my office today to tell me about Moshi Monsters, his company’s virtual world for kids that is signing up a new member every second. Moshi Monsters was his “last roll of the dice” to save his virtual worlds startup in 2008, and it worked. Moshi Monsters is up to 35 million registered users, with about 7 million of those active every month, says Smith. And it is projected to generate $100 million this year from a combination of subscriptions and gross retail merchandise sales.

The site is geared towards kids between 5 to 12 years old. Each kid gets a monster pet and a room that can be decked out with virtual goods. But instead of trying to create “just another bloody virtual world,” Smith wanted it to be more like a safe social network. “Instead of copying Club Penguin,” he says, “we focused more on Facebook and tried to re-imagine that for kids.” There is pin board where friends can leave messages and a news feed, but there are also games, quizes and virtual world activities. The penny-drop moment for us was that kids like to share and show off online just as much as adults do,” he says. “If we could create the safe place online, we could create Facebook for kids.” In the video above, Smith explains his strategy and gives me a brief tour of the site.

Moshi Monsters started in the UK, where Mind Candy is based, but now the U.S. is its biggest market. It makes money off of subscriptions ($50 a year to unlock different levels and get extra powers), but there are also toys and today it even launched a magazine for kids, Moshi Monsters Magazine (print’s not dead!). Smith wants to create a mini media empire from the little monsters, with plans to develop video games, TV shows, books, and iPhone/iPad apps.

In the clip below he demonstrates the first Moshi Monster iPhone app, which gives you a Moshi Monster mouth that moves as you speak.

Moshi Monsters, from UK startup Mind Candy officially launched last week with a product that marries the ideas behind Neopets and Tamogotchi with a social network for kids.

Users adopt their own Monster and keep it happy by solving daily puzzles that are sent to each player. Monster owners can interact with their pets by tickling them, playing games, shopping, designing their rooms, and shortly by dressing them up. One core element being promoted for Moshi Monsters is the ability to build an emotional bond between the user and their Monster, which is achieved through flash animation and a complex behavioral engine. Monsters develop their own unique personalities depending on how well, or badly, they’ve been treated.

Players can connect and communicate with others through the Friends Tree, visits to other Monster rooms, Monster blogs, Newsfeeds, and a messaging system. The site is geared towards kids, so online safety is a top priority and the Moshi Monsters team monitors site activity to make sure it remains safe.

Now admittedly it sounds like Neopets or similar services with some social networking thrown in for good measure, but where Moshi Monsters stands out is with $10 million in backing from Index Ventures, Accel Partners, and Newmediaspark. Sure, money should never be the final judgement on any site, but well known VC firms think there’s something here worth investing in. I’m also no judge on what kids like (mine isn’t quite old enough yet to use this) so ultimately you (or your kids if you have any) can be the judge.

TechCrunch UK has more on the Moshi Monsters from when the site first launched in closed beta back in October 2007.

Eyespot offers drag and drop flash video editing direct to consumers and in partnership with companies like Blip.tv and Veoh. Competitor Jumpcut was acquired by Yahoo! last month. From cell phone ring tones to short video clips, online multimedia editing is clearly being bet on as the next step for the YouTube generation. Veoh has Michael Eisner and Overture’s last CEO Ted Meisel on its board. Blip.tv is the foundation of CNN’s new citizen video initiative. Partnerships like this make Eyespot look like VideoEgg, the company that provides browser based video capture to social networking sites from Bebo to Dogster. Liz Gannes reports that Eyespot also has partnerships with Lions Gate Entertainment, Current TV, Zomba/Jive, TVT, Columbia, Epic, Island Records, and Concord Records. What a list!

TechCrunch UK broke a funding story today as well. Online gaming company Mind Candy has announced that it’s raised $7 million from Accel Partners, Index Ventures and NewMedia Spark. Mind Candy has created a very popular game called Perplex City. The game incorporates real world events, websites, text messages, TV, print and a wide range of other media to create an immersive gaming experience, says TechCrunch UK’s Sam Sethi. For details on the company and its plans for expansion based on this funding, see Sethi’s coverage.