What does it take to win a $1 million business plan competition? Try this: Technology, traction and team. The answer varies every year, but this year’s winner of Rice University’s “World’s Largest and Richest” business plan competition has developed a new medication that helps older people heal broken bones.

By the way, it’s not a $1 million first prize; it’s $1 million in total prize money. First place gets investment, cash and services worth a combined total of more than $385,000.

That first place prize this year was awarded to BiologicsMD, which is developing a new medication that builds better bones. It’s especially important for people over 50. There’s a long way to go–years, in fact–but the team from University of Arkansas had to impress a lot of judges and beat a lot of other impressive ventures to take first prize. I found an earlier (March) video of the company’s 60-second elevator speech available on YouTube, shown here below.

Winning a business plan contest like this one is a major achievement. A committee chooses the best 42 teams from among hundreds of entries. The teams are divided into seven tracks of six. For each, dozens of judges, most of them investors and business experts (I’m a repeating judge there), read their business plans. Then, last Friday, those same judges met the teams on campus at Rice to listen to their pitches, ask them questions and choose one finalist from each track. On Saturday all the judges met again to choose the final winner.

To win the first prize, BiologicsMD had to convince the judges that it had a realistic chance to get the medication through FDA approval, plus defensibility against competition, technology owners and an excellent management team.

If you’re interested, Fortune and CNN Money will have a lot more on the competition, including (I hope) some online video, next month.

I’m afraid I had to cancel my trip there at the last minute, for reasons completely unrelated to the contest, so I missed the first-hand experience this year for the first time in several years. I will be there next year. I was able to read six of the 42 plans entered, and I can say it was a very impressive field.

BiologicsMD’s first prize  includes a $285,000 equity investment, $20,000 cash and more than $80,000 in business services. The company also gets an entry to next month’s Moot Corp business plan competition at the University of Texas in Austin, the original business plan contest that now brings in the winners from many other contests and bills itself as the “Superbowl” of business plan contests.

The Rice contest is a lot more than “just” a business plan competition. Brad Burke, managing director of Rice Alliance for Technology and Entrepreneurship, said, “Through the mentoring and networking available at the RBPC, more than 70 percent of last year’s competitors have gone on to successfully launch their companies, raise funding and build their businesses. We look forward to watching the future successes of this year’s crop of competitors.”

That’s an interesting statistic.

I’m in Houston today, very much looking forward to spending today and tomorrow as a judge at the Rice University Business Plan contest. I was a judge here last year as well, and I loved it. It’s an excellent event, very well-run, with a great field of competitors.

As the day starts, I’ve read nine of the 42 plans entered, and the quality is excellent.

I was happy to see the news release this morning, about Rice Alliance of Rice University’s entrepreneurship center winning the USASBE (United States Association for Small Business and Entrepreneurship) annual award for the outstanding specialty entrepreneurship program. No, I’m not an alum there, but yes, I’m proud to say I’ve visited twice in recent years. I participate in the annual venture competition there, and it’s a great program.

I’ve met the professors, talked to the students, done some guest speaking, and had enough time to see what I’m talking about. There’s a very nice international mix there, and interested, interesting, and engaged students. Plus the Alliance, which is one of the best links between community and academic entrepreneurship anywhere.

My congratulations to Brad Burke, managing director of the Alliance, and Philana Diaz, director of the annual business plan competition. Well deserved.

The Rice Business Plan Competition is now accepting applications for the 2009 competition, to be held April 16 – 18 in Houston, TX. Only 36 teams will have the opportunity to compete in this prestigious competition, and one lucky team will walk away with more than $675,000 in cash and prizes.

All interested teams must submit an Intent to Compete no later than February 13, 2009 to be eligible for the competition. Palo Alto Software is proud to once again sponsor the competition and provide all teams who submit an Intent to Compete by the February 13th deadline with a free download of Business Plan Pro Premier Academic Edition software.

If you meet the eligibility requirements and are interested in the opportunity, I would highly encourage you to submit an Intent to Compete. I attended the competition in 2007 and can honestly say it was an experience I will never forget. It is by far one of the best business plan competitions out there today.

Kristen Langham
Manager of Business Development
Palo Alto Software, Inc.