Millionaire rebel takes revenge on Ivy League

Tim Cornwell on the man whose vision of 'McEducation' terrifies US academia

From the unlikely setting of an industrial park outside Phoenix, Arizona, the rebel son of a Missouri sharecropper has sent a tremor through the comfortable world of American academia.

John Sperling, a Cambridge University graduate and one-time Fifties beatnik, has struck gold with his vision of "McEducation".

Twenty years ago he launched his University of Phoenix with eight students. It is now the biggest private university in the country, with 40,000 students and growing at an increasing rate.

With no central campus or football team, run for a profit and open only to working adults, it defies all the notions of a conventional college.

The university is scattered across 100-plus learning centres or "outlets", most in the West, in rented office buildings. It offers mostly professional degrees to students with an average age of 35 through once-a-week night classes within easy commuting distance. The 4,500 part-time lecturers are working professionals, teaching for about $50 an hour.

The University of Phoenix was nearly strangled at birth by the established colleges, which saw it creaming off lucrative business and accused it of being a diploma mill. Now a fully accredited university, it is described as the US's biggest challenge to a higher-education establishment personified by lofty Harvard and Yale.

The Apollo Group, the holding company of the University of Phoenix, went public in December 1994. Its stock value has swelled from about $100m (pounds 61m) to $2.3bn. Wall Street has given a massive thumbs-up to the notion of a for-profit university selling courses to adults.It has made Dr Sperling a tycoon of the business of education, at 76. He and his son Peter, a vice-president of Apollo, are now worth on paper about $400m each. "He is more than just a rebel, he is a revolutionary," said the younger Sperling.

Dr Sperling may not quite be education's answer to George Soros, but the two men met in New York last week for a chat. "Two supporters of a losing proposition, who thought they should get together and ask what happened," said Dr Sperling.

The proposition in question was Initiative 685, the latest effort to legalise the medical use of marijuana, this time in the state of Washington, after California and Arizona voted to do so last year.

Both men have supported drug law reform efforts to the tune of several million dollars, but the initiative was decisively rejected. Dr Sperling describes the US's drug war as insane, stupid, greedy and "welfare for cops".

The US higher education market is valued at about $200bn, serving 14 million students at 37,000 colleges. It hands out a million bachelor's degrees a year. But it is dominated by traditional public colleges and non-profit private ones. Dr Sperling's recipe is mass-produced - students learn the same classes in Oregon as in Florida - and moderately priced if not cheap, costing about $6,000 a year.

"McDonalds has not aspired to be Maxims," said his son, "but you know that you are going to get a good healthy meal."

Dr Sperling grew up through the Depression and ran away from his family's farm at the age of 16 to join the Merchant Marine. He was illiterate, and learnt to read at sea. After the Second World War he went to college in Oregon, then went to Cambridge for a doctorate in economic history. Moving back to a Californian university to teach, he became interested in adult education.

At every stage of his venture, Dr Sperling has been treated with contempt by the powers that be. Universities in California were told not to contract with his fledgling business - he was even accused of bribing California's Governor, and investigated by the FBI, he says. He moved to Arizona, where universities fought to deny him official status.

Dr Sperling struck back by hiring the best-connected law firms in every state whose market he aimed to penetrate, and with a well-funded political campaign to deregulate the higher-education market. The US has no equivalent of Britain's Open University, and Dr Sperling says he has plumbed a market that established universities "didn't even know existed". According to surveys, only one-sixth of the US's students fit the stereotype of full- time students living on campus, at a time when there are growing workplace requirements for degrees.

In the past five years he has invested heavily in a company growing salicornia - a plant that thrives on sea-water irrigation in desert or low-grade soil - on experimental farms from Saudi Arabia to Mexico. While the plant produces vegetable oil, it is touted for "sequestering" carbon dioxide from the earth's atmosphere, and Dr Sperling claims it could reduce global warming as efficiently as rainforests. A losing proposition to date ... but if "carbon credits" are adopted for industry at the Kyoto summit, Dr Sperling may have struck gold again.