I agree with the last post. I would add a couple more observations:
First, I feel that you need an explanation about exactly how things work on the home page. I believe that when you have a site like yours you have to assume that people have no idea what the site is about. And while your URL is very descriptive you need to make very clear what the sites focus is. I would write a short description of the site above the "Featured Contests" line. Maybe something from your FAQ section:
What is Logo Bids?
"We are a community of professional designers worldwide that work for you. We create logos, web sites, letterheads, magazine ads, post cards, business cards, t-shirt designs and other graphic designs at a price you set. Do you need a design for yourself or for a client? Post your requirement with us and see the amazing results you will get from our professional designers from around the globe. "
Below that I would add the link to the "start a contest" page. This will let those interested in receiving a logo design a clear path and understanding of what you offer.
Next I would the content for those who are entering the logo contest. Again, this is a whole different topic than those looking for a logo design. You have a good description in the FAQ section for this as well:
What are design contests?
"A design contest is a requirement posted by a contest holder, which gives designers a brief description of work that they need done. Professional designers then create designs to meet the need of the contest holder. Throughout the contest, the contest holder can provide feedback to help designers improve or change their designs. At the completion of the contest, the contest holder picks a winner and the prize money is awarded."
Overall the idea is good and similar to the threadless.com approach. They were recently featured in INC Magazine.
You should consider maybe changing the landing or home page to offer two options, Get A Logo Design and Enter Logo Contest.
Hope you found this helpful!