More than 500 teams applied to participate in the richest business plan competition in the world, Rice University’s Business Plan Competition in Houston. The 42 still standing will compete this weekend.

On-campus entrepreneurship is hotter than ever. At the Stanford Graduate School of Business, a record number of graduates founded their own companies last year. It was the same story at Wharton. And programs like Harvard Business School are plowing resources into student startups like never before.

Some of the best of those MBA businesses will go head-to-head this weekend at Rice’s competition, which kicks off Friday. Over the next two days, the 42 teams will vie for the competition’s largest pool of cash and investment prizes to date, which tops $1.6 million — a pot that makes Rice’s event the richest student business plan competition in the world.

Since 2002, the Rice competition has launched 156 actual businesses, which have cumulatively raised $844 million. Last year alone, investors put $244 million into former Rice competitors’ ventures. Eleven of those startups have sold themselves to other companies (or, in Rice parlance, “made a successful exit”). And they’ve done pretty well. Case in point: Auditude, which won in 2005, sold to Adobe (ADBE) in 2011 for $120 million.

Of course, Rice isn’t the only business plan contest that can claim successful alumni. Fashion powerhouse Rent the Runway was a part of Harvard Business School’s competition. The Rickshaw Dumpling Bar placed in NYU’s Stern’s event. And delivery giant GrubHub (GRUB), which IPO-ed last week, won at the University of Chicago in 2006. It now has a $2.4 billion market cap.

The real value of a business plan competition is face time with investors and experts. (Plus, time off from school to obsess about the business.) Rice has 250 judges, most of whom can be seen powwowing with teams in the halls during the event, peppering competitors with questions and advice. But for young ventures, the prize money can go a long way.

Of the $1.6 million in cash and investment prizes that will be given out at Rice this year, $1,000 will go to the team with the best elevator pitch — which is a 60-second plea for funds delivered to a standing room-only crowd in a packed Houston auditorium. One team will get $100,000 from the Department of Energy for advancing clean tech. And the grand prize winner will take home at least $450,000 from Rice-affiliated investors and friends of the university.

Keep an eye on Fortune.com in the coming days for updates on the business plan victors.