On the other hand, sometimes your major sustainable competitive advantage is your IP. My current employer has developed an algorithm that pretty much blows anybody else out of the water for what we're doing and they most definitely don't want anybody else learning about it. Granted, their strategy is simply don't tell anybody (All I know is we have the algorithm, not what it is), but protection of IP can be important in some cases. If what you're protecting will be obvious once your product is out there, then yes an NDA is pointless. However, if you want to protect some behind-the-scenes technology that won't be evident to anybody using your product, then an NDA may be in order.
I agree with the post. When an idea is new there is a tendency to feel like it needs protecting. If you're serious about it, though, and get your hands dirty with the details of implementing whatever it is, NDA's seem more and more silly. By the time you get a real good idea working you won't care if the whole world knows. You know that as simple as the idea sounded, it's really thousands of hours of blood sweat dollars and tears. You'll say- "oh, you want to do it also? go right ahead and try."
yeah agree. Another cool metric is "if your idea can be given away by telling someone" then it doesn't have enough depth" Most simple things are way more complicated when u do them - and thats in the thought of the implementation.
Just look at eBay - a platform for auctioning goods. The depth comes in generating a trust system (how?) then making it easy to list, and for people to send each other goods. Then each of these ideas can be fleshed out. So its not really one idea - its a whole bunch including design decisions, customer acquisition strategies, page element preferences, copy, bug fixing - a whole load.
Many NDAs require the disclosing party to describe, list, or specify the confidential items disclosed. But often I find when very early stage inventors ask people to sign NDAs they often fail to specify what is disclosed even though their agreements require it. If you ever have to enforce an NDA, trying to argue that the entire conversation was confidential is much harder than simply producing the list of disclosures.
Also, I've never asked an investor to sign an NDA. Asking someone to sign an NDA indicates a lack of trust. IMO if you don't trust the people you are talking to you probably shouldn't be talking to them at all.
Recently I've been asked to sign NDAs as part of employment interviews. This seems to have almost become standard practice now. I don't really think this is a great idea, and I often won't take an interview that requires an NDA. But sometimes if I am certain that I won't be developing my own ideas in the field I'll sign one. Inevitably I find that these employment related NDAs are the most frivolous, silly, and irrelevant ones I sign. YMMV.
Go ahead and keep a secret when you really strategically need to keep a secret. Don't get emotionally attached to it being a secret though- because one day, probably soon, it'll get duplicated. And do you have a thoroughly thought out realistic business reason to keep it (temporarily) secret in the first place? Usually not in my experience.
In my experience the acquiring company will require an NDA since as a public company they would not want early acquisition discussions disclosed. I've only done one such transaction but I understand this requirement is typical.
The company to be acquired also wants to have an NDA in this case since in the event that the acquisition does not proceed you don't want your negotiating position revealed to other potential acquirers before you have chance to even negotiate with them.
It is easy to come up with ideas, but some ideas are better than others. Maybe I can agree to the level that "ideas in nuthsells" are worthless. For example anyone can have the idea to "create a really elegant computer", yet most people agree that only Steve Jobs can pull it off (just look at the TV computer design challenge by intel - so depressing). But I think in his mind the idea is more than just the nutshell description. And having THAT right idea doesn't seem to be trivial to me.
About an year ago, a company hired me to code a corporate instant messenger. There was no technologically innovative angle to it; yet, my employer insisted that I sign an NDA before the project be disclosed to me. The process took about three weeks and wasted time that could've been spent on actually coding it.
In my opinion, NDA's are more useful when they are used to protect a "technology" rather than a "product".
