But it’s a rather anachronistic question, because the whole notion of “denominations” didn’t develop till some time later. No one was trying to start a denomination. The “Reformers” were trying to reform the Catholic Church. The “radicals” were trying to restore the true Church which they believed had been destroyed.
When do you first consider “Lutheranism” a separate Church? Arguably not until 1530, with the Augsburg Confession. But Luther had been excommunicated back in 1521. And throughout the 1520s various regions and cities within Germany had introduced changes in how the Church in those regions functioned in order to conform with Luther’s teachings and those of his colleagues. These regions and cities had protested in 1529 against being told to stop these changes, and this is where the word “Protestant” comes from.
Meanwhile, one big split had opened up within the “reforming” camp–between Luther (backed by the northern Germans) and Zwingli (backed by the Swiss and less enthusiastically by many southern Germans). This split took several years to develop, but was formalized when the two sides failed to agree at Marburg in 1529.
And at the same time you had lots of “radicals” of various sorts running around throughout the 1520s promulgating (without state backing for the most part) more extreme versions (at least more extreme in certain respects–in other ways they were very medieval) of Luther’s and Zwingli’s teachings. This I suspect is where the figure of “hundreds of sects” comes from.
The 1520s is often called the period of “wild growth” for the Reformation. It was a time of great chaos, and this chaos convinced the “mainstream” Reformers that they needed to pay more attention to questions of authority and organization. Starting in the 1530s, you began to see more organized forms of Protestantism, and gradually we can start to talk about “confessions” (or, if you must have it, “denominations,” though that’s really a term better reserved for the American context and similar situations where there is complete freedom of religion).
Edwin