Image courtesy of Aamir Rehman; design by Cure.
Overview
Biotech investor and Columbia Business School professor Dr. Aamir Rehman explains why the strongest early funding signal isn’t your science—it’s your founder’s equity. Here’s how it shapes investor trust.
When biotech founders think about raising capital, they naturally focus on the science, the data, or the regulatory plan. But according to Aamir Rehman, EdD, Associate Professor of Practice at Columbia Business School and Chair of Innate Capital Partners, there’s one signal investors look for before anything else—long before grants, venture capital, or strategic partnerships.
And it comes from you.
In his lesson for Cure’s Concept to Cure series, Rehman breaks down the seven major funding sources available to healthcare startups. But one insight stands out: Founder’s Equity isn’t just an accounting detail—it’s the earliest and clearest indication of your commitment, your priorities, and your discipline as a builder.
View the entire fourth lesson of our Concept to Cure course, The Healthcare Founder’s Guide to Raising Capital. All lessons available exclusively to Cure members.
Why Founder’s Equity Matters More Than Early-Stage Biotech Founders Realize
Founder’s Equity—the capital you personally put into the business—may seem symbolic in the context of a science-heavy startup where future rounds will dwarf initial contributions. But Dr. Rehman explains that it plays three critical roles that investors quietly evaluate.
1. It shows you’ve made a real financial commitment—not just an intellectual one.
Investors want to know you have skin in the game. “Not only have you put in effort, but you’ve also put in money,” Dr. Rehman says. Even a modest contribution demonstrates seriousness, discipline, and a willingness to share risks.
2. It protects your own family’s financial boundaries.
Dr. Rehman stresses that Founder’s Equity is also about risk management for the founder, not just optics. Tracking what you put in helps ensure you are advancing the company responsibly—not jeopardizing your personal finances.
RELATED: How to Raise Pre-Seed Funding, From Biotech Founders Who’ve Done It
3. It’s the first test of prioritization.
One of Dr. Rehman’s portfolio companies illustrates the danger of under-commitment: a founder who put in very little equity later pivoted to a second venture, leaving investors feeling the first company was no longer a priority. “He had not put in enough money of his own to make it a serious commitment,” he notes. The signal was there from the start.
For R&D-Heavy Biotech, Equity Is a Signal—Not the Whole Story
Dr. Rehman is clear: research-intensive biotech startups aren’t expected to fully fund themselves with Founder’s Equity. Grants, loans, and venture investment will inevitably carry the weight. But the early signal still matters.
Founder’s Equity becomes a way of saying: “I am building this intentionally, and I will see it through.”
And for investors evaluating dozens of pitches with similar scientific merit, this early indicator of founder commitment can meaningfully shape the trajectory of a relationship.
RELATED: How to Nail Your Seed Raise—From Biotech CEOs Who’ve Been Through It
Concept to Cure Video Series
We are proud to introduce Concept to Cure, our 12-part video series built for healthcare founders and operators turning breakthrough ideas into real-world impact.
Across these expert-led lessons, biotech CEOs, venture investors, and policy leaders share the frameworks and hard-won lessons that move innovations from early concept to clinic and beyond.
From validating your market and building investor-ready business models to navigating FDA approvals, scaling commercialization, and leading high-performing teams, each episode distills the practical insights entrepreneurs need most.
Concept to Cure lessons are available exclusively to Cure members.
