Drucker's disciple

Alexander Brigham is a small player in E2C and E2B, but his Corpedia Inc. has landed Peter Drucker for a series of interactive web-based courses on executive management. America's leading philosopher of organizational management, now 90, will be a big draw to people who want to sharpen and update their executive skills by the Net. "We are now the Peter Drucker brand," declares Brigham, a 31 -year-old former investment banker.

"We developed 30 hours of lnternet-based educational material based on Peter's latest thinking," Brigham says. In the programs Drucker expounds his principles, after which multiple-choice questions appear on the screen. If viewers click the right answer, Drucker's dubbed voice responds in his heavy Viennese accent with comments like "excellent" or "very good." If the viewer flubs, Drucker says, "Son, you are wrong." Interactivity is further enhanced with e-mail, periodically reminding users of goals they set for themselves during the course. As an incentive to work at it, successful students get a certificate. Eventually Corpedia and its competitors hope to offer accredited M.S.A. degrees.

Brigham's outfit, based in Phoenix, Arizona, is lining up other big-name teachers-the University of Southern California's Warren Bennis, among them. Aware that he will be competing on the web with well-known business school brands, Brigham counts on competing with brand-name scholars.

Can a small company-Corpedia's revenues may be $5 million this year-compete against well-heeled "first movers" that got in early, like Knowledge Universe and The Washington Post Co.? Can it compete with business schools that have enormous prestige? Brigham enjoys explaining how closely Corpedia hews to Peter Drucker's philosophy. Take the "first-mover advantage," so beloved of Internet junkies. "Peter and I decided that the first-mover advantage was no advantage at all," Brigham says. "Too many dot-coms confuse short-term market share with long-term market dominance."

Brigham cites Prodigy, the ambitious dot-com once backed by IBM and Sears. Prodigy had huge resources and pioneered in business-to-consumer marketing on the Internet. "AOL just waited for the market to be created," Brigham recalls, "and then blew Prodigy away with a better product. That's going to be our strategy: Be a smart, slow mover rather than a dumb, first mover."

Brigham is neither a techie nor a professional educator. He was a history major at Yale who learned investment banking at Lazard Freres and prospered as a junior partner at the LBO firm Clayton, Dubilier & Rice. A multimillionaire at 29, he grew restless in 1998 after working on such big Clayton deals as Lexmark Printers. LBO deals were getting pricey, and he wanted to try his hand at building a business.

Why education? Helping turn around LB0s, he saw how tough it is for top managers to get their message across to thousands of employees. "There is only so much one person, no matter how brilliant, can do to disseminate expertise and pride. I could see that the Internet offered a better way to spread the message," Brigham says.

"Besides, education is the biggest industry that is still fragmented. The growth opportunities are incredible."

In March 1998 he left to start Corpedia, joined by Jay Wiggins, a fine arts graduate with an interest in computer graphics. They e-mailed 25 venture capital firms with summaries of their proposal. "We got one answer, a routine turndown," says Brigham.

But Brigham believed so deeply that he decided to use his own money (with Wiggins, he owns 100% of Corpedia). "There are advantages to not taking outside money," he insists. "We have strategic independence. We've no need to do a deal a day just to stay on the Bloomberg."

Corpedia's first products-and still its principal revenue producers-are legal-compliance programs on such subjects as sexual harassment and the foreign corrupt practices act. The programs are marketed to corporate legal departments that want to limit their companies' liability in the event of employee transgressions.

Now, with Drucker in his catalog, Brigham is advancing into a broader and potentially more lucrative side of E28 and E2C-individuals as well as companies can buy the course.

E2C and E28 haven't yet created the buzz that B2B and 82C have, but that will change as more and more smart, well-heeled players emerge. With Peter Drucker's help, Brigham is out to prove that those 25 venture capitalists missed a good bet when they snubbed his cheeky proposal.

Article from Forbes Global Magazine, May 15, 2000.

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