Purpose: The purpose of this study is to explore how owner-managers of small businesses can learn in peer networks to improve their management skills. It aims to offer a new way of understanding owner-managers' learning as part of a social process, by highlighting the complex, interactive relationship that exists between the owner-manager, his or her peers, and the wider environment. Design/methodology/approach: A peer learning environment was created for 67 owner-managers by providing a one-year management training programme, and interviewing participants in the entry-, mid- and post-stages of the programme. Drawing upon the cases of six sample participants, a theoretical framework for understanding how owner-managers learn in peer networks is proposed. Findings: First, this paper compares the value of peer networks and other types of networks such as families and customers/suppliers, and second, highlights the role of peer networks in facilitating critical reflection in the learning process. Theoretically, it provides a conceptual platform for further research in the learning of owner-managers as a social process. It concludes that higher education institutions (HEIs) can create an environment to support peer networks and to provoke reflective thinking, in so doing they can improve owner-managers' management skills. Originality/value: This study will assist HEIs in shaping how, and what, is provided in terms of management education for small business. (Contains 1 figure, 1 table and 1 note.)