When and How to Use Non Disclosure Agreements

  Most startups will need some outside help at some point. How do you protect your intellectual property then? Watch this video to learn more about non-disclosure agreements and how to use them.


I’m Bob Donahoe and for the past 15 years, I’ve been helping startups in protect their intellectual property. In 2009, I also founded a startup that developed hardware products and a mobile app to assist sports performance.

The Importance of an NDA

A nondisclosure agreement should be in the toolkit of every startup. That’s because every time you move forward toward a business goal, you will often bring in outside resources. It might be a 1099 contractor, a new payroll employee, or anyone else who helps you with resources that you don’t have internally.

For example, if you have a technology product and need a designer, you’ll need an NDA so that designer cannot take company confidential information.

Terms of the NDA

The terms of the NDA are fairly standard. You should work with your attorney to figure out the specifics of your situation. You’ll typically see:

  • scope of confidential information defined
  • exceptions to confidential information an ability to get and receive injunctive relief to stop an NDA breach
  • a term for the agreement

Every small company as they move forward will almost automatically need to pull in resources from outside the company. Every time you do, you want to be aware of whether you should use an NDA. Ask yourself: is it necessary for me to disclose confidential information? If the answer is no, then you don’t need an NDA ― but of course you should err on the side of caution if you think the relationship could evolve.

Taking Inventory of Your Confidential

You also want to understand how to identify any confidential information that you possess. General categories include everything from business plans and business strategy to technical details to sales details. If you maintained information in confidence and have not shared publicly, then it’s probably in your interest to keep it confidential.

NDA for Marketing and Business

In addition to the technical and product design, you would also look at using an NDA on the marketing and business side. For example, if you want to add an outsourced social media marketing firm or individual, you’ll have to share contacts and customer lists ― and that information is confidential to your business. It’ll be necessary then to work under a nondisclosure agreement.

Hiring an IP Attorney

To select an IP attorney for your business, you want to make sure that their background and skills match up with your product. For example, if you’re developing a medical device, you’d want to IP attorney with expertise in that area and experience on the patent process.

As an IP attorney, you have the opportunity to work with teams that are passionate about what they’re doing, and there’s a certain amount of joy and passion that comes with working with people like that.

How Keep Your Product Under Wraps and Stay Out of Court

If you find somebody is in violation of an NDA, you need to notify them immediately to cease and desist. Thus, it’s essential to include an injunctive relief, or the ability to have a court issue an order to stop a party from releasing confidential information.

The damage is done once that information is public, so it’s important that you have the ability to go to court and stop it in advance. You want to be sure to act quickly if you see a breach or potential breach of your NDA.

About Robert Donahoe

Intellectual property & technology attorney, engineer and innovator Bob Donahoe assists clients with a combination of legal, technical and business skills developed over 15 years of practicing IP law, experience as a company founder and more than ten years’ experience in engineering, business and legal with General Electric. Bob is relied on by large multi-national companies and start-ups alike because of his technical depth, versatility and efficient approach in support of their business needs. Bob values opportunities to provide IP strategy for creative startup teams – especially those intending to disrupt their selected domain. His personal experience as a founder includes leading teams that successfully developed and brought to market hardware and software products used to improve sports performance – including creating a top-ranked (and patented) paid mobile sports app.

Linked-in: https://www.linkedin.com/in/robert-donahoe-49863349

Web: www.rdiplaw.com