Protect Your Ideas: Use NDA’s

 
Freaking out because you want to get an idea to some investors, but afraid they will steal your bait?  Fear not!  I have your solution!

NDA -  Non-Disclosure Agreement… according to Wikipedia:

is a legal contract between at least two parties that outlines confidential materials or knowledge the parties wish to share with one another for certain purposes, but wish to restrict from generalized use. In other words, it is a contract through which the parties agree not to disclose information covered by the agreement. An NDA creates a confidential relationship between the parties to protect any type of trade secret. As such, an NDA can protect non-public business information.

NDAs are commonly signed when two companies or individuals are considering doing business and need to understand the processes used in each others business solely for the purpose of evaluating the potential business relationship. NDAs can be “mutual”, meaning both parties are restricted in their use of the materials provided, or they can only restrict a single party.

Basically, you can’t use any of the information and you can’t disclose any of the information occurring to anyone.  Let’s say you reinvent the wheel – if you show your friend the wheel without a signed NDA, he can steal the idea since it isn’t an intellectual property.  If he signs it, you can show him every little detail – if it is replicated in any way, you have the rights to the property.

Fortune recently wrote an article on protecting ideas which outlines the importance of NDA’s.

You can protect yourself with a nondisclosure agreement. Ask the company you are approaching to sign it before talking to you.

“This is a relatively simple contract to protect the confidentiality of each side’s IP,” Stock says. “It states that you will not use any information you learn about the other party unless you are doing business together.”

Stock also suggests that when you do meet with the company, you present them with some of your technology as a first step, but not all of it: “Wanting it all at once can be a bad sign. The partner should understand that you want to establish a trust first.”

Don’t be dumb with your ideas…  secure them.