I don't follow.

It's galling for the UK government to promote a service to the exact types of businesses that you think that service is fine for?

I mean, didn't they recommend it on a resource dedicated to start-ups?

From a designer's point of view yes; just because it doesn't really matter to Bob's Plumbing whether they get the logo done cheaply by their local print shop or get 30 designs by Filipino teenagers doesn't mean their local print shop is going to be delighted at the loss of £200 revenue and a chance to upsell some business cards. Especially not when the site purports to be encouraging an "enterprise-led recovery" for the economy

They also might take exception to the notion that race-to-the-bottom logo work fits under the site's "creating a brand" heading; 99designs is exactly the resource for businesses where visual branding doesn't matter much (which in fairness is a lot of them).

I see what you're saying now.

I considered a start-up roughly equivalent to the sort of cash-strapped small business you think 99designs is fine for.

Whereas you're primarily drawing a line between start-ups and those other businesses.