There are thousands of posts about why sites like 99Designs.com are bad news for businesses and designers, so I won't try to summarize them all. But I'd like to provide a couple links to helps educate upcoming designers and artists about why this dreaded 'Spec Work' and croudsourced designs are ill-advised and actually hurt you as a creative professional. These practices also hurt the credibility of the client business when they take advantage of artists in this way.
To use the old cliche, you wouldn't hire a plumber to fix your toilet only to pay him if you decide you liked his personal technique. We are professionals, and our services should be approached as such. So please avoid sites where businesses are encouraged to ask designers to put their time, resources, and reputations on the line in hopes that the business won't steal your work or decide to pay you a low price after the fact.
(Note: I realize some consider Threadless submissions spec work, and while I agree that it fits the bill in some ways, it's with a conscious knowledge of its other benefits that I draw the line. A perk of submitting to Threadless is its ability to provide feedback on the designs, and in the end, the work is still yours to sell or market if not accepted for print by Threadless. On the other hand, being asked to design a client specific graphic only to have them pay someone else for the job is unethical.)
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