Board Composition That Actually Works

I once worked with a board where the CEO instructed every executive not to answer questions directly in meetings. If a director asked you something, you were to look at the CEO. He would answer for you.

The only board member with genuine biotech experience started asking the obvious question: how have we used the money we've raised to progress the science? The question was never answered. He asked again. And again. Eventually he resigned, walking away from his own investment, because he couldn't get a straight answer to a reasonable question in a boardroom he was supposed to govern.

Years passed. No new patients were recruited. The science didn't move. Millions were raised and spent, and nobody on the board had the expertise or the independence to notice that nothing was actually happening.

That company's board wasn't badly intentioned. It was badly composed. The CEO had chosen directors for their compliance rather than their competence, and the result was a governance structure that protected the CEO's position rather than the company's mission.

This is the first in a series on the decisions that kill biotechs. We start with board composition because it's the foundation everything else rests on. Get it wrong at formation, and you'll spend years fighting a structure that was never designed to help you succeed.

The typical early-stage biotech board looks something like this: two founders, two investors, one "independent" director. It feels balanced on paper. In practice, it creates predictable failure modes.

The investors have aligned incentives with each other. They sit on multiple boards together. They've done deals before. They'll do deals again. The "independent" director was often introduced by one of the investors. They may be genuinely experienced. They may be genuinely well-intentioned. But when the pressure comes, loyalty leans toward the people who put you in the room. That's not conspiracy; it's human nature.

The current funding environment makes this worse. In 2025, biotech venture rounds have concentrated into fewer, larger bets: the median round tracked by BioPharma Dive hit $93 million in Q1, while early-stage seed and Series A investment fell 23% year-over-year. When capital is scarce and investors hold more power, board dynamics tilt further. Down-round investors now routinely demand additional board seats, stronger voting rights, and liquidation preferences. The governance consequences compound long after the term sheet is signed.

I've seen boards where every "independent" director owed their position to the lead investor. That's not independence; that's theatre.

Most founders treat boards as a necessary evil of fundraising. Incorporate the company, hold board meetings, tick the governance box, move on. This is a mistake that becomes visible only when it's too late to fix.

A well-functioning board should make the CEO more effective, not more constrained. The practical work includes pressure-testing assumptions, brainstorming solutions to problems, and opening doors. Investor directors can offer genuine feedback on how to position the next round. Independent directors with domain expertise can vouch for the quality of the science in ways that build confidence across stakeholders.

The board should be a strategic asset. If it feels like oversight at best or obstruction at worst, something has gone wrong.

I've seen the opposite of this at a company where I was hired to support the Executive. Fundraising proceeds that should have funded clinical development were redirected to buy out existing shareholders, against my advice. The CEO and co-founder became instant millionaires. The company's runway was gutted. And the board, lacking anyone with the experience or independence to challenge the decision, approved it.

When I tell you board composition is a survival decision, I'm not being dramatic. I'm describing what I've watched happen.

After years of observing boards that work and boards that don't, the principles are clearer than most governance advice suggests.

Scientific fluency is non-negotiable. At least one board member must understand the biology deeply enough to evaluate scientific decisions, not just ratify them. I've seen companies raise money repeatedly while the science stood still, because nobody on the board had the expertise to notice. Boards without scientific fluency default to trusting management on science and second-guessing them on everything else. That's the worst of both worlds.

Operating experience matters more than brand names. A former CEO of a similar-stage company will understand your challenges in ways that a famous academic or retired pharma executive may not. They've made hiring decisions under time pressure. They've navigated board dynamics from your side of the table. They know what 18 months of runway feels like.

The "who do they actually work for?" test. For every potential board member, ask yourself: when interests diverge, whose side will they be on? If the answer isn't "the company's," think carefully before proceeding. I've seen board members treated as chess pieces in power games rather than as stewards of the company's mission. The test for genuine independence is not how a director was appointed; it's how they behave when the CEO and the lead investor disagree.

Board economics matter more than you think. When directors depend on board fees for a meaningful portion of their income, their independence evaporates. I've seen governance captured by individuals who used board economics to enforce compliance. A chairman who can threaten to remove a director's income has leverage that no amount of good intentions can overcome. It's subtle until it isn't.

Here's the uncomfortable truth that founders rarely discuss: your Series A terms determine your governance for years. Board seats are negotiated alongside valuation and liquidation preferences, but they receive a fraction of the attention.

Investor board seats are negotiable. Founders rarely negotiate them. The default assumption that lead investors get board seats feels inevitable until you realise it's simply convention. Protective provisions often matter more than board seats themselves. The right to block certain transactions, approve budgets above a threshold, or consent to new equity issuances can give investors effective control even without a board majority.

I've seen founders give away board control at Series A and spend the next three years fighting to get it back. At one company, I watched as the CEO and Chairman identified the right strategic path, secured an investment term sheet to pursue it, and were overruled by controlling shareholders whose time horizon didn't match the opportunity. Those shareholders chose a bigger slice of a smaller pie. The company was eventually sold for little real value to anyone.

The time to negotiate is before you need the money, not after.

Governance failures are easier to describe than governance successes, because dysfunction is dramatic and alignment is quiet. But it exists, and it's worth describing.

When I was approached about the CEO role at Santero Therapeutics, I looked at the board structure before I looked at the data. What I found was unusual enough to shape my decision.

The founder, Cedric Govaerts, sits on the board as an active participant in strategic decisions. He stepped back from the CEO role because he understood what the company needed for its next phase. That kind of self-awareness is rare. The independent director has deep scientific knowledge and prior experience in antibiotic drug discovery: functional independence backed by genuine expertise. The Chairman is there to support, not supervise. The investor directors contribute through network development and strategic input, not passive monitoring or aggressive oversight.

At AMPLY Discovery, where I serve as Chairman, governance works because of mutual respect and deference to expertise. Three clear pillars: technology, commercial, science. Each person knows the others' strengths. They challenge each other but defer on domain expertise. Nobody is building an empire. Decisions are made based on what's best for the company.

These aren't perfect boards. They have tension. But the tension is productive, and it's aligned around the mission rather than around individual power.

Every board seat you give away is a vote on your company's future. Choose voters who share your mission, not just your cap table.

I've watched governance failures cascade into strategic failures into scientific failures into companies that couldn't complete their mission. Each of those failures was a medicine that never reached patients who needed it.

The science is hard enough. Don't make it harder by building a governance structure that works against you.

This is the first article in a six-part series on biotech governance. Next: The CEO-Chairman relationship nobody talks about honestly.

I write Beards on Biotech because I've seen what happens when governance fails. If these patterns resonate with your experience, I'd like to hear from you.