My homebrew club, the Cedar Rapids Beer Nuts, has been running an all homebrew festival since 2012. It's not huge, around 500 people attending, but we're working hard to expand it this year. There's gotten to be a ton of commercial beer festivals around here so there's no shortage of options for beer lovers. But we have lots of fun with it and we've got clubs from around the state participating. Another Iowa/Illinois club also started one last year in the Quad Cities area. I don't think another organization doing a HB fest necessarily hurts you as long as there's no date conflicts.
Like any major endeavor, you need to sit down with a core group of volunteers to draft out goals and a plan. How big do you want it to be, where will you hold it, how much will you charge, date (this is really important), how will you advertise? That's just a start. A fest is a lot of work so your group needs to be really behind the idea. You also need your club to donate a LOT of beer. For us that's not a big problem because our members love sharing beer at fests. We built a custom 10 tap portable bar and have a couple of 5-7 tap jockey boxes too, with plans to expand. We end up rotating through taps all day to get everyone's beer on. Between us and the other clubs, there's a dizzying variety of beers for attendees to sample.
We're extremely fortunate to have an awesome corporate partner, a local beer and wine store. They hold their own large commercial fest in the spring that our club has poured at for something like 10 years. They wanted to help us out and host our fest in the fall. They take care of getting city permits (we use the street in front of their store which gets closed down) and provide some things like sun shades and ice. We don't have to pay any kind of site rental or event charges. We would be hard pressed to pull it off without their help. As such, we don't have any other sponsors involved.