The Rise of Practice-Excellence in Entrepreneurial Education

In a post-COVID world defined by rapid globalization, technological disruption, and artificial intelligence (AI), the demand for innovative business leaders has never been greater.

Universities are responding by transforming traditional business education into dynamic, practice-oriented programs that equip students to create value in unpredictable markets.

Central to this evolution are business school incubators and experiential networks that bridge academia and industry, fostering the next generation of entrepreneurs, particularly technology startup founders who must navigate complex, interdisciplinary challenges.

One exemplary model is the Practice Excellence Network (PEN) at Edinburgh Business School, launched in 2024 after successful pilot bootcamps. PEN coordinates real-world knowledge exchange projects, matching business school students with startups to address genuine capability gaps. This initiative exemplifies how modern entrepreneurial education extends beyond lectures, embedding students in live business environments where they act as agents of change. By consolidating theories from business performance, organizational change, and psychology, PEN creates a collaborative talent pool involving students, researchers, and companies. Over the last 6 months, it facilitated 28 student-led projects, demonstrating measurable impact on both learners and partners.

Business school incubators like PEN are essential components of contemporary education because they prioritize experiential learning over theoretical isolation. Traditional curricula often silo disciplines; yet, today’s technology startups require founders who integrate diverse knowledge skills and experiences – engineering with marketing, data science with strategy, and innovation with operational efficiency. PEN addresses this by building interdisciplinary team capabilities, crucial for founders in volatile sectors.

For instance, innovative micro-businesses and tech startups typically excel in dynamic capabilities like R&D and product development but lag in operational areas such as scaling, administration, and customer intimacy. Conversely, established SMEs shine in operational excellence but struggle with adaptability in branding or communications.

A notable PEN case involved a research-based engineering firm producing smart swim gear. High in product development but low in marketing and communications, the company struggled to scale. PEN paired it with digital marketing students who consulted on branding strategies, closing the gap and enabling market growth.

Such projects highlight how incubators assess organizational capability profiles, drawing from resource-based view theory, to match academic talent with business needs. This capability-performance relationship ensures projects target real deficiencies, enhancing long-term performance.

Interdisciplinary team building is particularly vital for technology startup founders, who rarely succeed in isolation. Startups operate in undefined markets, demanding dynamic capabilities to reconfigure resources amid change. PEN’s approach fosters these by immersing students in triadic relationships: Learner, business client, and academic supervisor. Through semi-structured Scope of Work (SoW) agreements, students practice value-based judgment, refining problem statements via reflexive dialogue while using AI tools for efficient solutions. Problem definition remains human-driven, emphasizing intuitive and analytical thinking influenced by ethics, motivation, and cultural values, areas where humans outperform AI.

Findings from PEN’s latest 28 case studies reveal key enablers: Maximizing learner responsibility and building triadic alignment and trust. Granting students full project ownership by decoupling responsibility from initial competence, encourages intuitive judgment in client interactions and analytical rigor in deliverables. Clients often evolve from skepticism to mentorship, supporting students’ continuous professional development. Trust emerges through effective communication, commitment, and intimacy, empowering learners and boosting engagement. In startup contexts, social controls like interactive and belief systems predominate, stimulating bottom-up innovation.

This framework complements AI’s strengths: Vast processing power for answers, while humans excel at asking the right questions. As AI disrupts industries, entrepreneurial education must cultivate human-unique skills, reflexive dialogue, moral judgment, and relational trust, to guide technological deployment.

Universities adopting incubator models like PEN are shaping resilient leaders. Recommendations include aligning student capabilities with projects, treating learners as professionals, and leveraging experienced supervisors. Businesses should view partnerships strategically, mentoring students and articulating challenges openly.

In conclusion, the rise of entrepreneurial education signals an optimistic shift. By integrating incubators that prioritize interdisciplinary collaboration, universities are not just teaching business, they are forging practice-excellent leaders ready to harness AI, bridge capability gaps, and drive sustainable innovation. In an era of unlimited computational potential, human judgment remains the spark for transformative entrepreneurship.

Dr Tom Pfefferkorn is Director of the Edinburgh Business School Global Incubator, Heriot-Watt University