NDA

Non-disclosure agreements, and why most investors won't sign one.

Also known as: NDA, non-disclosure agreement, confidentiality agreement

An NDA (non-disclosure agreement) binds someone to keep shared information confidential. Between founders, employees and contractors it is routine and useful. Presented to investors before a pitch, it is a red flag — most reputable investors refuse to sign, because they see hundreds of similar ideas and cannot risk litigation over independent thinking.

sign freely:  employees, contractors, pilot customers receiving roadmap detail
don't bother: investors (they'll pass rather than sign), casual conversations

Protect ideas through speed and execution, not paperwork. What actually needs protection — code, data, customer lists — is covered by IP assignment, employment terms and access control, not by an NDA waved at a first meeting.

The classic mistakes:

Demanding investor NDAs. Signals inexperience and filters out the busiest (often best) investors first. Pitch without one; share sensitive detail in stages as trust builds.
Mutual NDA theater with no teeth. A signed page nobody enforces, covering everything and nothing. If secrecy matters (M&A talks, deep pilots), scope it: what exactly, for how long, with what remedy.
Confusing NDA with IP ownership. An NDA restricts disclosure; it does not transfer ownership. Contractors need both an NDA and IP assignment — one without the other leaves half the risk open.
One-way NDAs presented as mutual. Founders often sign investor-side standard NDAs without reading. Read every word; one-sided confidentiality plus non-solicits can bite later.

Use NDAs for employees, contractors, serious pilots and M&A — scoped and mutual. For pitches, replace the NDA with staged disclosure: public story first, sensitive numbers under relationship, never under a form signed in a café.