Forget Silicon Alley. Stars Head to Houston for Pitch Contest The Rice Business Plan Competition, set for April, is the biggest student competition of its kind -- and a symbol of Houston's thriving entrepreneurial side.

Editor's note: Over the next few months, we'll be taking a virtual tour of U.S. cities to see how the 2008 financial crisis has changed the entrepreneurial landscape, for better or worse.

You can't talk about the Houston startup world without talking about the Rice Business Plan Competition. While it's not the oldest – Moot Corp at the University of Texas in Austin takes that honor – it's grown into the largest student competition of its kind. Launched in 2001, the three-day event attracts thousands of student teams from around the world who ultimately compete for more than $1 million in cash prizes from various venture capital firms, angel investors and corporate partners.

While teams come from all over, the event has helped bring national attention to Houston's thriving entrepreneurial community. "One of the judges, who lives in Silicon Valley, says that every time he tells his friends that Houston has the largest and richest business plan competition, they get an amazed look on their face," says Brad Burke, executive director of the Rice Alliance for Technology and Entrepreneurship, which puts on the event. "They're wondering "why don't we have this in Silicon Valley and why is it in Houston?'"

To anyone who's spent some time in Houston recently, the answer is obvious. Not only does the city have a long and prolific tradition in business, "it has a strong entrepreneurial eco-system, and it's only getting stronger," says Burke, pointing to a wave of new specialized incubators, accelerators and co-working spaces, including Rice's own OwlSpark accelerator, slated to open in May. In fact, the Kauffman Foundation, which studied cities' entrepreneurial activity in 2011, ranked Houston in the top 10, trailing Los Angeles and New York but ahead of Boston and San Francisco.

Related: Crash Course in Business Plan Competitions

At the same time Houston's startup community has evolved, so too has the business plan competition. "We started with nine companies competing for $10,000," says Burke, a former information technology executive and entrepreneur who was a judge at the first event. The competition back then focused on two rounds of presentations – a far cry from the marathon pitching sessions that are a hallmark of what it is today.

The event, scheduled this year for April 11-13, will kick off on Thursday afternoon with 15-minute practice presentations and feedback from judges – there are 250 of them, the majority of whom are investors, entrepreneurs and professionals based in Houston. The day culminates with the always-popular 60-second elevator-pitch competition. This doesn't factor into the overall winners, but cash prizes are awarded to teams with the best spiel. After a traditional Texas barbeque dinner, competitors have time to tweak their pitches for Friday – when the real competition begins. Teams are broken into "flights" based on industry segment, with the top teams advancing to the semi-finals; the others go to a consolation Shark Tank Round. The groups make their final presentations on Saturday, and winners are announced at a 700-person awards gala that evening.

While it helps to have a lively and well-crafted pitch, teams are scored first and foremost on the viability of the business idea. "We want the judges to vote on the team where they'd be most likely to invest their own money – not just the most academically sound business plan," says Burke.

Related: Inside the SXSW Startup Competition

Since 2001, nearly 130 teams have gone on to launch their companies and are still in business. Of that group, life sciences companies Semprus BioSciences and Veran Medical Technologies went on to raise more than $20 million each. In 2011, Adobe scooped up another notable competition alumnus, Auditude, for a reported $120 million. Last year's overall winner, NuMat Technologies from Northwestern, is also showing big promise. The company, which has found a better way to store and transport natural gas, went on to win the first ever U.S. Department of Energy National Clean Energy Business Plan Competition in June.

In March, the organizers will announce the names of the 42 two- to five-person teams that will convene in Houston this year for a long and intense weekend of pitching, tweaking and networking. Teams tend to fall in one of four categories – life sciences, energy, information technology and, relative newcomer, social entrepreneurship – all areas near and dear to Houston's broader business community.