There's no better way to show off a new web application than by navigating through it with an expert hand, telling its story and recording a short demo video. Some startups pay a pro to make their videos but more people make their own. Sometimes they are terrible.
Attachments.me is a startup that makes it easy to sort through your email attachments and the company has a pretty good little demo video on its front page. Co-founder Benjamin Coe posted a video about videos yesterday and his method for making simple demo videos looks like something many people could benefit from watching. Different people have different methods for making videos but the big take-away I got from watching Coe's is that it's important to have a plan. I like his.
The biggest difference between this approach and many other peoples' is that it's common to record audio first instead of last.