I have been invited to participate in an "handicap" type of race.All it says in the invitation is
that they have prize for the best time + 10 placings.

I might sound retarded,but can someone explain to me all about "handicap" type of races. All I have done in my life is "scratch" races. I would also like to know of some techniques, tips and tricks for this type of race.

Thank you
Isn't that a normal seeded type of race? If you have participated before, they take your time relative to the winning time and seed you accordingly. That way everyone starts in a group of relative equal ability. I don't know, I'm guessing here.
During a hanicap race riders are grouped with ability. Usualy (on long circuits) riders with lesser ability are sent off first with following groups sent off minutes later. The last group to be sent off is the scratch group. The groups are usualy handicaped so that all of the groups arrive at the finsh line together.

Tactics for the scratch group must always be catch the lead group, however other groups can try and catch the group in front, stay on their own or wait for a faster group to 'join'.

For the individual it is useful not to do too much work at first and to save effort for when their group is caught by a faster group and the '**** hits the fan'. The person who wins is the first person across the line and the +10 are the 10 people that follow.

In a time trial handiacaps work differently, riders are given time bonuses based upon their PB's for the distance. This alows all riders to compare their times equaly, they are aiming for the 'relative' best performance. In a timetrial as ever the tactics are to cover the course as fast as you can, however greater time bonuses are given to those that do not have good PB's and so benefit riders who do not ride/chase fast courses (so have a bad PB).
typically, handicaps are as mentioned above with the slower riders setting off in groups b4 the faster riders/groups. the idea of the handicap is obviously to win (ie first across the line), but there is almost always another major prize, most often "chopped" between the bunch with the winning rider in it, known as fastest time. Fastest time is most often raced for by the last 2 bunches ("scratch" and "chopping block"). it is very simply a prize given to the rider with the lowest accumulated time for the race (taking into account the handicap).

Also to be considered in handicap racing is the rider etiquette of working. While riding in a bunch u should keep working/swapping turns as much as possible (or atleast make it look like u r) until the bunch behind catches u. It is considered bad practice to "sit-on" and sprint in a handicap race. Riders quickly earn a reputation for doing this and are often the targets of many attacks while racing. I for one have been known to do this, so take my word that it isn't a good thing to get a reputation for.

Lastly, it is always a good idea to make an agreement with the riders on your "mark" as to whether they are going to "chop" any prizemoney at the end, as handicaps are almost ridden as a team time trial. U r better off to ask somebody on the day but this is the basic idea of handicap racing.
Of course whether to 'sit on' or not to 'sit on' depends on how much you want to win or use it as training. If it is a training race, then work in a team as above, however if you want to win consider changing your tactics.

If your dead keen on winning don't worry about your reputation. How many world champs don't have bad reputations for at least one aspect of their personality or racing!
Usually a handicap is a calculation that some math whiz comes up with the to create and even playing field.

In the last handicap race I saw, they gave the woman a 9 minute handicap. Which meant, they started 9 minutes ahead of everyone else, so that supposedly everyone would end up at the finish in a neck and neck race.

Seeded races are common in triathlon and are actually the OPPOSITE of using a handicap. As a matter of fact, the slower you are the later you start. If you are "seeded" with a lower number, you start earlier because you are quicker. This strings things out on the race path so that no one is tripping over anyone else.

In a handicapped race, the slower ones or the ones given a larger handicap will start first in hopes that the quicker ones who start after you will catch up.

This way, they can stop awarding segregated awards like age groupings and male/female awards. They just award the overall winner, which is whoever crosses the finish line first. I have seen many seeded races where the first person who crossed the finish line wasn't necessarily the winner.
Thanks for all feedback. I won't "chop" the prize money with you ;D