Ask HN: Running a contest/competition | Hacker News Reader

Ask HN: Running a contest/competition

5 pointsmegamark162 comments

So I'm working on my little side project, a webapp builder called AppRabbit (http://apprabbit.com) that is similar to Zoho Creator or DabbleDB. It's still missing some key features but I'd love to get people using it and giving me ideas for the direction I should take it. So I decided it might be fun to have a contest to see who can build the coolest or most useful app with it, and I'd give away something small like a gift card or a something as a reward to the winner.

So my question is, has anyone done something like this before? Do I need to worry about laws and regulations with regards to doing a little contest like this, or should I just wing it and try to keep it simple? I figured I'd just judge this round myself, and maybe down the road if I do something like this again have some sort of judging committee or something.

So what do you folks think?

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(disclosure: it's been ~10 years since I last had direct first-hand knowledge of this).

Giving away something for free in a "no purchase required to win" sort of promo is generally not a problem. The giveaway should generally be cheap (less than $600, or maybe it's $2000 now)... anyway, less than the amount that would be required to file a tax form in conjunction with the giveaway. Prize winnings are supposed to be considered taxable income, but at a low threshold point it is not an issue. In your case, I believe you're not going to be able to afford a big enough prize for this to matter :)

The contests where you have more issues are the lottery-ticket type systems where people pay to have a shot at winning a prize. The two big issues there (again, see disclosure above) are that you generally have to have some sort of non-profit status, and you have to have ownership/control of the physical prize before collecting money (you can't use a portion of the ticket sales to purchase the prize and then keep the difference).

For what you're describing, I think it's a good idea and easy to implement with no complex overhead or liability.

Contests that don't have a sweepstakes component are generally simpler from a legal perspective -- many states regulate contests in which prizes are awarded at random.

Contest losers sometimes sue on grounds that the contest sponsor supposedly changed rules after the fact. (Such suits are often brought for breach of a "unilateral contract" (see generally http://en.wikipedia.org/wiki/Contract#Bilateral_v._unilatera...). With that in mind, it's usually better for contest rules to be as detailed as practicable, especially as to how winners will be selected.

(This isn't legal advice, we don't have an attorney-client relationship, etc., etc.)

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