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At Sprintlaw, we’ve spoken to thousands of small businesses and startups.
Often, their biggest concern is protecting the confidential information that keeps their business unique and competitive.
Whether it be protecting your startup’s intellectual property at its early stages, or just wanting to keep early commercial discussions private, most of the time the solution could be a simple Non-Disclosure Agreement (NDA).
You might have heard other businesses say it’s important to have an NDA, and you might be thinking it’s time for you to have one sorted, too.
But what is an NDA and when might you use it? And how does it differ from a Mutual Non-Disclosure Agreement?
This article will quickly walk you through everything you need to know.
What Is A Mutual Non-Disclosure Agreement?
Put simply, a Non-Disclosure Agreement is a confidentiality agreement. It is an agreement by the parties not to disclose confidential information to other people.
A Non-Disclosure Agreement is a legal contract between parties who are about to share confidential material, information or knowledge; and want to make sure that it is actually kept confidential.
Generally, a NDA will prohibit the other party to disclose any confidential information that you provide to them.
A Mutual Non-Disclosure Agreement, on the other hand, works both ways.
In this case, a Mutual Non-Disclosure Agreement prohibits both parties from disclosing any confidential information that you provide to them.
When Do I Need A Non-Disclosure Agreement?
For small businesses and startups, there are various situations in which you may need an NDA.
If you’re a startup about to pitch to investors, you may want to have an NDA drafted to make sure that any confidential information you share about your business model is not disclosed to anyone else.
Or, if you’re any small business about to engage with another party, and you’ll be disclosing your business’ sensitive and key information, an NDA is a good way of making sure that this information does not spread.
When you’re engaging with investors, suppliers or even contractors, it’s natural that they’ll have access to some of your confidential business information.
This could include anything from your internal business admin documents to your client databases.
The last thing you want is somebody using this information and sharing it with others, and this is where an NDA may come in.
In many ways, an NDA protects confidential information that could also be seen as the ‘intellectual property’ of your business — the intangible assets that keep your business unique from its competitors.
And, while there are many ways to protect your intellectual property, navigating through these options could be a little bit overwhelming.
So, having an NDA is usually a good place to start.
This kind of contract can be handy no matter what kind of business you’re running (and this is why most businesses like to have an NDA ready for whenever they might need it).
Why Are Non-Disclosure Agreements An Important Tool For My Business?
An NDA or a Mutual NDA is more than just a legal contract that might often be used as a scare tactic!
At Sprintlaw, we’ve seen how NDAs are a great tool for small businesses and startups.
Why?
Whenever you engage in important commercial discussions, it’s always important to make sure that all parties are on the same page.
Having an NDA or a Mutual NDA between you and another party instills a degree of trust and confidence, which in turn can assist in open negotiations.
For this reason, NDAs are a valuable tool for businesses as both parties can feel reassured that any confidential information and intellectual property is protected.
Need Help With A Mutual NDA?
Thinking it’s time to get an NDA or a Mutual NDA sorted for your business?
We’re here to help!
NDAs are a great way to keep your important business information as confidential as possible.
And, even if you don’t have a particular reason to need one now, it’s always a good idea to have an NDA handy for your business (you never know what might come up!).
At Sprintlaw, we’ve helped hundreds of startups and small businesses make sure they’re prepared for situations where their confidential information is at risk.
Whether you need help preparing an NDA, a Mutual NDA or are looking for other ways to keep your information protected — we’d love to chat with you!
You can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
Get in touch now!
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