At Khan Academy we’ve been trying to brand ours as “Healthy Hackathons” — people can stay late optionally, but we kick them out at 11:45pm to get sleep, bring in healthy food, snacks, and activities, and always commit our real working hours / work week as part of the schedule (not just weekends/after hours).
We actually just held our Monday-Friday Healthy Hack Week last week (http://healthyhackathon.khanacademy.org). One of my favorite weeks ever, particularly because we encourage “hacks” of all kinds that don’t have to include coding, and the entire company dives in, which is my favorite part.
They’ve been internal only so far. Maybe some day we’ll open it up.
I think internal hackathons are really great. Then it isn’t about getting free labor or marketing your API, it’s about letting employees worm across department lines on projects they would never see in the normal course of their day.
I actually ran a few hackathons for a former employer and it was great fun. (It was a small company with about 10 people participating.)