
Why You Shouldn't Ask Us to Sign Your NDA - philk10
http://spin.atomicobject.com/2014/09/08/nda-stifle-creativity/#.VA2z0dDm4CI.hackernews
======
patio11
Partly, NDAs are one of the weird things where high-status/power/etc
organizations dictate "Hey, low-status/power/etc person. We have an arbitrary
hoop here. You must jump through it." They're usually contracts of adhesion
("Negotiate the terms of the NDA? They were established by legal 5 years ago
and everyone uses the same ones. Get with the program.") and usually filed-
and-forgotten.

This is why VCs treat entrepreneurs' NDAs like a mark of immaturity and why
Fortune 500 companies treat their own as usual indicia of serious business
being conducted.

Personal stance: Asking me to sign anything catapults me out of "friendly
chat" mode and into "enterprise sales" mode. I've only had one startup really
fail to understand the distinction. ("Hey Patrick, can you do us a favor and
fly out here to talk about X? We'll reimburse you for the ticket." "Sure!"
_fast forward to two hours before the flight_ "Oh, BTW, here's an NDA, which I
haven't read, but if I had, I'd know that you're already in breach of it
because our lawyers didn't think we'd ever talk to anyone outside the US." "I
have no desire to sign an NDA with you, most particularly not this NDA, which
clearly has not been drafted in anticipation of our circumstances." "We need
it to let you into the building." "WTF no you do not. If this is worth doing,
it is worth getting Legal to fix this. If you will not waste Legal's time with
it, I will simply decline to sign." "I didn't expect you to be difficult on
this." "PLEASE CLARIFY WITH YOUR CEO WHICH OF US IS DOING THE OTHER A FAVOR."
"Umm maybe we can skip the NDA." "GOOD DECISION.")

There exist some entrepreneurs who, having worked at BigCo, believe that
constructing straw replicas of BigCo's NDAs will result in having BigCo levels
of success. This is not a success-enhancing belief.

~~~
dreamweapon
_" Hey, low-status/power/etc person. We have an arbitrary hoop here. You must
jump through it." They're usually contracts of adhesion ("Negotiate the terms
of the NDA? They were established by legal 5 years ago and everyone uses the
same ones. Get with the program.") and usually filed-and-forgotten._

And to add to the fun and joviality all around, quite often the people who ask
you to sign agreements like these (or their spiritual counterparts: overly
aggressive indemnity clauses) don't actually know (haven't bothered to read
the nuts and bolts of) what they're asking you to sign. Which has a lot to do
with how they suddenly get so anxious when you ask questions about (let along
make specific objections to) particular bullet points that you're being asked
to sign on the dotted line for.

------
jacquesm
If you're a professional contractor signing NDAs is a non-event, it's as
normal as someone tipping the waiter after a dinner or opening the door before
you attempt to walk through.

In a world full of rip-off artists keeping your mouth shut, promising under
penalty that you won't be poaching your employers employees and promising to
keep your data carefully and to get rid of it after the job is done is simply
good practice.

There are plenty of parties for which signing an NDA makes no sense but if
you're a hired gun that will build something or do some work for a fee then
signing and NDA is par for the course. Just like any other document you sign
you _do_ want to read all of it just to make sure there isn't anything funny
in there about you having to eat 10 Kg of brown M&Ms or something like that.

On another note, I would work with contractors on occasion on projects for
myself and I would not ask for any NDA preferring instead to rely on my
judgement of who to do business with and who not, after all an NDA will need
to be enforced if there is ever a problem and that's harder than it looks.

But someone who starts _before first contact_ about how they're not going to
sign my NDA (without even finding out if I would require that) is definitely
not going to be hired.

~~~
objclxt
Back when I worked for a digital agency we used to get a lot of clients trying
to get us to sign _non-mutual_ NDAs, which was a big red flag.

Here's how it would go: you'd go in to pitch for a new app or campaign. To
pitch, you'd be expected to sign a NDA. So far, so good. However, all too
frequently these would be one-way NDAs, meaning there was nothing stopping the
potential client from taking our pitch and farming it out to a cheaper agency.

We never actually had a client refuse to change to a mutual NDA once we
pointed this out. If you're signing a NDA and it's _not_ mutual you should ask
why. How come the other party's secrets are worth protecting but not your own?

~~~
jacquesm
That's a super good point, a good NDA is symmetrical.

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tptacek
Most consulting firms do in fact sign NDAs. It's uncommon for VCs to do so,
but it's not at all unprofessional to ask a contractor to do it, and certainly
doesn't make you look inexperienced.

Perhaps some firms prefer not to sign NDAs before they have a master agreement
in place and some commitment to work. Fair enough. We'll sign an NDA
immediately, though.

~~~
bellerocky
I think in the context, a person with an idea and no code, it does come of a
bit silly to want to sign an NDA. I'm not sure why a consulting company works
with such people. I'm guessing they cater to people with ideas who have too
much money?

~~~
JoeAltmaier
Its simple. Consulting companies have to talk to people to get jobs. Those
people commonly ask them to sign an NDA. You do it or you don't get the first
conversation.

Was a consultant, signed way too many silly NDAs.

~~~
tptacek
There's an easy solution to this problem: just have your own confidentiality
agreement (which you can have vetted, once, by your lawyer), and offer it.
We'll sign other firm's paper, but we won't do it without legal review, and
we'll avoid legal review if it looks like no work is going to come from the
discussion.

------
err4nt
The only people who have asked me to sign NDA's have been for project which
amounted to very little.

I work as a contractor so my experience may be different than a full time
employee, but for me somebody asking me to sign away my rights for the chance
to hear their idea does not attract me. It's a huge red flag to me that they
are more interested in locking down their idea than realizing it.

My parents taught me a long time ago that creative people give ideas away, and
non-creative people cling to the best idea they have run across. If somebody
steals from a creative person it's no loss, they have a dozen more ideas and
know how to come up with new ones. If a non-creative person has their idea
stolen it's a MASSIVE loss because they don't know how or when another idea
will come across their path.

In life, I have been the creative type and not afraid to let my ideas go, but
somebody locking down even discussing their idea send me warning signs they
'arent' a creative type and will guard this one idea they have to the death.
That's not conducive to me taking it and turning it into something beautiful.
Would you expect a seamstress to make a beautiful gown out of fabric you keep
under strict lock and key in a box? They can't work with it!

~~~
jacquesm
I've been asked to sign NDAs for projects that ended up becoming very valuable
companies. The idea alone would have been somewhat valuable to the right
company at the time.

For instance, in 1985 I built a system that eventually became a very large
company that specializes in digitizing/printing photographs on credit cards.
At the time it was technologically _barely_ possible so a lot of work needed
to be done but the total secrecy of the project was a huge factor in the
eventual success of the company. When they rolled out there was simply no
competition.

It all depends. If you need the work, sign the NDA, if you don't need the work
be prepared to lose the customer.

~~~
wpietri
The relationship between "signed an NDA" and "total secrecy achieved" is...
not a given.

The people to whom this article is addressed, business novices, might be
better off achieving secrecy without using NDAs at all. They probably can't
afford to actually enforce an NDA if something goes south.

Tech entrepreneurs in particular are, I think, much better served by focusing
on creativity and speed of iteration as a barrier to competition, plus a fair
bit of discernment in what they tell to whom. A copied-from-some-body-else NDA
strikes me as about as valuable to a modestly funded entrepreneur as a crepe
paper seat belt.

------
wpietri
Makes perfect sense to me.

Most NDAs I've seen are idiotic. A good NDA is symmetrical, limited in time,
limited in scope, and covering the minimum necessary. But the ones I see are
often one-sided, indefinite, and enormously extensive. No matter what the NDA
says, the truth is that if you send me something in email, I am never going to
go and remove that information from my backups. But please, keep asking for
return of all information, just like this is still 1953.

I have also never actually heard of an NDA being enforced, ever. I've seen
them honored and I've seen them violated, but I've never seen anybody go to
the trouble of bringing suit over one.

On many occasions, though, I've seen early relationships get bumpy because
some novice wants everybody to sign a bad NDA. Then some poor service provider
either has to a) suck it up and sign a document they have no intention of
honoring in full, or b) try to help the business noobs understand why a bunch
of their NDA terms are wrong, dangerous, or pointless. It's a no-win situation
for the service provider, and I've definitely become "too busy" rather than
deal with another novice and their bad NDA.

------
erkkie
Sounds like signing NDAs prematurely is the problem not NDAs all-together.

------
josefresco
What about "We might be working on a similar project" as a reason? Over the
years many have walked into my office asking for us to sign an NDA before
uttering a word. The chances are small but let's say their awesome idea _sort
of_ relates to a side project that I'm working on. 99% of the time you're
going to be fine, but that could be said about not using an NDA at all.

~~~
damoncali
Literally every NDA I've ever seen had a provision for pre-existing work. It'd
be sort of nonsensical not to.

~~~
josefresco
You just need to prove your work was pre-existing, and also prove that what
you learned in your meeting wasn't used in the further development. Basically
it can get very sticky.

------
pmh
Reminded me of [http://blog.jpl-consulting.com/2012/04/why-i-wont-sign-
your-...](http://blog.jpl-consulting.com/2012/04/why-i-wont-sign-your-nda/)
with previous discussion
[https://news.ycombinator.com/item?id=3844893](https://news.ycombinator.com/item?id=3844893)

------
sybreon
I think that the context matters. In the case of an external consultant being
asked to sign an NDA (whether prematurely or otherwise), Eric S Raymond
presents some compelling arguments on why and how NOT to sign them.
[http://esr.ibiblio.org/?p=2394](http://esr.ibiblio.org/?p=2394)

------
Kompulsa
People often treat NDAs as if they are a trivial way to protect ideas.
Unfortunately, there is nothing trivial about anything law-related.

NDAs are legal agreements (always a serious thing), and you could end up
agreeing to something unreasonable without realizing it.

This is just a warning to ensure that everyone handles NDAs carefully.

------
poslathian
I'm surprised no one here is talking about flow down terms. We have never made
any partner or contractor or employee sign NDAs for disclosing 100% internal
material, but it only takes one partnership with a fortune 500 (and we have a
bunch) before you are knee deep in NDAs with clauses such as "any contractor
or employee must be bound by terms at least as restrictive as those herein."

Now if anyone on the team wants the register map for the next-gen SoC we are
using in our product (so that they can, you know, write some damn code) we
have to start pulling NDAs out...

------
damoncali
As a contractor, I'm pretty sure every NDA I've signed is meaningless. They
just never amount to anything, and the standard one that everyone seems to use
is pretty watered down. Just never been an issue. If you're thinking this way,
you're focusing on the wrong things - from either side of the transaction.

Now if I were a professional investor? Wouldn't touch one. Far too many
butthurt entrepreneurs out there who will think you stole their idea.

------
phkahler
We don't want to sign your NDA until it's time for you to sign our NDA.

This "ideas are cheap" concept is getting really old. You need a good idea AND
execution. But execution alone is just as worthless as a bad idea. Execution
amplifies the value of an idea, and amplifiers are just as common as ideas.

What if my "secret sauce" is a whole new concept and being first in a new area
would be a significant advantage? Hint: I have just such an idea.

~~~
pbreit
An NDA is not going to protect you anyway. If you truly have some secret
sauce, be a little careful in what you say to outsiders. They typically don't
need to know the details anyway. That's part of your execution.

~~~
phkahler
>> An NDA is not going to protect you anyway.

Why not? Companies make people and partner companies sign them all the time.
Why would they not be effective for people?

What if it's a new idea? If the idea is obvious only in hindsight and it
doesn't take much secret sauce, then what do you do? You can't communicate at
all, so build it yourself I guess.

------
ausjke
The title should be "3 Reasons You Shouldn't Ask Us to Sign Your NDA for your
premature thoughts". NDA has its place in many other fields.

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kordless
Attempting to protect an idea at a given stage with an NDA makes little
logical sense, which then _might_ be a sign the person asking for an NDA might
not know what they are doing, business-wise. That doesn't mean the idea isn't
a good one, or that they won't succeed at bringing it to fruition.

------
pbreit
Article misses the main reason for entrepreneurs to not request an NDA: it
creates a massive risk for the other party while granting very little upside.
That's why it's rightly understood to be a rookie, uninformed move.

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Patrick_Devine
I feel like they're unenforceable, so why bother? Ideas are cheap; executing
on great ideas is difficult. Trying to litigate while executing on a great
idea while running a under-capitalized start-up is next to impossible.

------
typicalday
Odd little metaphor:
[https://news.ycombinator.com/item?id=8285240](https://news.ycombinator.com/item?id=8285240)

------
piqufoh
This post is the fourth reason why I wouldn't ask Atomic Object to sign my
NDA.

------
blazespin
Just file detailed provisional patents.

------
korzun
TLDR: Unless you are committed to work with another party, do not present them
with useless documents to sign.

I doubt this is a real issue. Usually NDA comes attached with your starting
paperwork to get the train moving.

~~~
hga
It's a real issue, I've been asked to sign NDAs before interviewing for jobs.

