Throughout the years we’ve had the benefit of working with a ton of incredible clients and their new product ideas. Clients come to us because of our experience. We love new ideas, they challenge our own thinking and allow us to be imaginative in our work. New ideas or new takes on old ideas can make for a great business model. However, disclosing those ideas come with some risk.

Once in a while, we are asked to sign non-disclosure agreements (NDAs) by parties considering hiring us. An NDA can be important since it typically protects any type of confidential and proprietary information or trade secrets. If you have trade secrets or other information that is confidential, you want to keep it that way. When it comes down to it, we’re usually happy to sign on the dotted line.

NDA is a formal ‘I won’t share your secrets and you won’t share mine’ agreement. But how many secrets does a company really need to protect? And what’s the consequence if those secrets are shared? Above all, how would we uphold the NDA if the secrets are shared? An NDA can only be really helpful as a legal document in the case that the parties end up in court. And if you end up in court, it’s going to be expensive –  very expensive.

Most of the time an NDA isn’t necessary for the projects we work on. The process of signing an NDA can often hold up timelines, create awkwardness around trust boundaries, and simply waste time better spent getting to the guts of an idea. Here are a few reasons you may not need an NDA. You may wish to consider these before asking another party to sign up to protect your information.

 

Your idea isn’t that original (sorry)

It might be hard to hear this, but when it comes to product or service ideas, someone else probably thought of it before you. This doesn’t imply that none of your information is confidential, but sharing a couple of details for a project usually will not bring about any damage. Before you ask for an NDA to protect your “great new idea”, you should consider checking it on Google first.

You’re not dumb, but having another party sign an NDA for an idea that’s already all over the web can make you look it. If you want to work with another party long- term, you don’t need them wondering if you have trust issues. Having someone sign an NDA doesn’t protect you if what you share is already out there, or can be easily found through a simple online search.

Obviously, if you have a trade secret or a patentable idea that’s not yet submitted to the patent office, you’ll need that protected. If you’ve done the research and recognize what you have is not the same as everything out there, an NDA is appropriate. Ask a lawyer if you’re not sure that your idea is patentable or needs protection.

 

We won’t steal your idea.. promise

Another reason for using an NDA is that people are afraid that we’ll steal their idea. If you truly have information to protect with an NDA, we’ll sign it. Even if we didn’t, we wouldn’t construct your idea ourselves – we’re graphic designers. it’s not what we do. 

Creativeblox is very much prepared and well equipped to help your idea become an online reality. We can help you build a brand and come up with visuals to aid your success. We’d love to be a long-term partner in your business growth, but we’re not interested in stealing your business.

 

You don’t even know what you have

You shouldn’t be asking for an NDA if you haven’t done lots of research because you might not even know what you’ve got. Depending on the language in your chosen NDA document, protection is likely limited to information you directly disclose. If all you have are the bare bones of an idea, you may be missing the piece that makes that idea great.

When you disclose that skeleton to a group of smart people, they will have new ideas that you haven’t thought of. Those new ideas are likely not secured by the NDA, or worse, may be considered disclosures by the other party, which you are obligated to keep secure. Most work agreements will have provision for intellectual property ownership that is made during the project. Most NDA documents we come across don’t have any provision for new ideas produced through discussion of a potential project.

You may actually be putting the ownership of that idea at risk if you come forward with an NDA with a half-baked idea.  If another party comes up with the missing piece that takes your idea from good to great, will you be left with anything of significant worth? 

Thus, NDAs are only helpful if the secrets disclosed would have a damaging impact on one of the parties involved. If we are sharing restrictive information or we’re disclosing top-to-bottom money related data that would harm us if leaked, then we can do the NDA dance. If we’re just giving basic information to each other, then NDA isn’t useful to the court. I have a pile of signed agreement from companies that insisted on an NDA before we can have a meaningful conversation. By requiring an NDA, these companies put up an unnecessary roadblock that slowed innovation. They are buried in paperwork for a false sense of security.

Often a novice attempts to get an investor to sign an NDA before sharing their ideas. It’s a sure sign of a newbie. When you approach an investor for money, it is unlikely that the ideas and technologies discussed are absolutely novel. Most likely the investor has already seen something similar, and if they haven’t, they soon will. If a businessman is truly worried about somebody “taking” the idea, then the idea most likely isn’t that great. A successful startup is all about execution, not novelty. Example: how many social networks existed before Facebook came along? Mark Zuckerberg and friends simply out-executed everyone else.

So in what situations does it make sense to sign an NDA?

  • Sharing specific financial data with each other that would harm the company. Example You need to disclose revenue, expenses, profits, margins and don’t want my competitors to have this information, then we probably will need an NDA. 
  • If we are going to show each other proprietary technology that is not yet commercially available, then we should probably sign an NDA.
  • If we are engaged in partnership discussions that will have a material impact to either of our businesses, then we should probably sign an NDA.
  • If we are profoundly engaged in merger and acquisition discussions, then we should probably sign an NDA. Neither party would want that information leaked, and the addition of an NDA demonstrates the seriousness of the parties.

 

If you send us an NDA to sign, there should be a very compelling reason that we need to sign it. Are we sharing proprietary information that could harm both of our businesses?  Would we really sue one another if the data gets spilled? If not, how about we disregard NDA and spotlight on structure a commonly helpful relationship. 

Regardless, we’re happy to oblige. We will review the terms and we will request changes if we think it’s necessary. Our goal for any new project is always ‘success’, and we’ll do our best to help you achieve that while protecting your information.

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