225. Do You Need an NDA?

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Okay, so you have a business, you're thinking of starting a business, and you are just so excited. You've got your idea, you're ready to go. And my question for you is, are you building your business on a solid foundation? Well, my name is Susan Sly, I'm a tech investor. I'm a co founder. I'm a mom. I've been in business since I was 11 years old. And today, I'm going to talk to you about NDAs. And before you start yawning, like,

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Oh, that's so boring, Susan, I just want to go out and make sales. I want you to watch this video. And today, this video could be the thing that helps to protect you and changes your business. So go ahead, hit the subscribe button. And let's talk about NDA.

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So, NDA stands for Non Disclosure Agreement, and they're part of everyday business. And you might be thinking, well, Susan, you know, I'll get the NDA going when my business is more mature, when I start making more money. But my advice to you is to think about the NDA right now. In this channel, Raw and Real Entrepreneurship, my goal is to help startup founders, new business owners, and people thinking about starting a business to build that solid foundation so that they can absolutely soar in their business. And that's what I want for you. So I want to begin and talk about this whole concept of an NDA. So your non disclosure agreement is designed to protect your personal information, it could be your client list, it could be how you do business, it could even be something proprietary about some technology in your business. And it protects you, essentially, from someone else, taking your idea, taking your client list, taking your database, and maybe competing against you in the exact same space. And so with this NDA agreement, generally speaking, you can go ahead and ask your corporate attorney to create one for you. That could be pricey, depending on your attorney. And I always advise you work with your attorney and just say, Listen, I'm starting a business, I have a very limited budget, how much will it cost to create a stock NDA for me? And price it out. Go shopping for it. There are services online, I have not used any of those services. So I can't comment on those. I always have my attorneys make my NDAs for my specific businesses. And also NDA is for specific things. So now that you know what this NDA is, generally speaking, it's going to be a fairly lengthy document, there are going to be provisions in there, including dispute provisions. So ADR language as an example, alternative dispute resolution. So what that essentially means is that instead of saying, hey, yes, you can sue me or whatever, that we're going to at least try and work it out. And so one of the things I look for in NDA is is ADR language, you're also going to see in your NDA, which states or provinces depending where you are, that this is applicable to where you would have your resolution in. And I would just encourage you that when you get your NDA created, that you have your attorney walk you through each and every one to section so that you understand it. So that's the first thing. That's what an NDA is. The second thing is who needs an NDA? Well, I want to begin with a story. So I had a woman who is new in business, and she was actually in a direct selling business. And she came to me to get some advice. And she wanted to know, what do I need to know to hire a great executive assistant? So I was sharing with her some tips on that. And the last thing I said to her was, make sure you get that assistant to sign an NDA. And so she followed all of the advice except for the NDA. Well, like anything, you know, when you're working with new people, you'll hire a new person, or it's like dating even. You just want to see the best in person. That's what happened in their relationship. And so my friend, she was like, Oh, this is so great. This person's amazing. Well, after several months, what that person did was take my friend's entire client list, her customer list, all of her top producers, their contact information. And that person went and joined a competing direct sales company and started soliciting all of my friend's clients and customers. And my friend called me and she said, I can't believe I didn't listen to you. So would the NDA have prevented that from happening? Not necessarily, but it does make people think twice and it does give you legal grounds to take action when things like that happen. Other ways you might use an NDA, if you have a contractor you're working with

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Even if you're having a meeting to discuss investing in your company where you're going to be sharing some proprietary information or showing how technology works, then you also need an NDA. All of my staff have NDAs with me. Why? Because they are, whether they're seeing my emails, or whether they're seeing client or customer list, we want to make sure that they're not disclosing that personal information out to other people. The third and final point about NDAs are just this concept of understanding when to execute the NDA. So we've talked about what it is, we've talked about why you do it. And now let's talk about when to do it. So generally speaking, the NDA happens as soon as you begin the conversation. So even prior to just creating this video, a friend called me up, he said, Listen, we have a mutual friend, that friend has a great concept, and they've already beta tested on some people. And he's looking for some advice. And so before I asked any questions, I said, Have him send over the NDA, and I gave him the company name and my title and the company under which we're going to execute the NDA. So when I'm doing business with people, one of the things I'll say to them, as you know, someone will say, hey, Susan, I would love for you to be an advisor in my startup, or I would love for you to maybe give me some consulting advice on a project I'm doing. The first thing I always say is, let's get an NDA going. My mentor, Harvey Mackay says great agreements prevent disagreements. And so hopefully, this video is helpful to you. Get the NDA going. If you're an early stage business, this is just a part of doing business. Make sure you're executing your NDA, even if you're in the middle of conversations right now. Say, Hey, you know what, oh my gosh, I should have gotten an NDA going, get that NDA going and trust me it will be a great decision. So with that, go out there and rock your day, rock your business, drop a comment below. I'm the one who answers all of your comments. If you're not a nice person, don't comment because I am a nice person. And I don't want to read not nice comments. So anyway, subscribe to the channel. I've got more videos just like this one. Raw and Real Entrepreneurship, getting raw, getting real and, walk you through the basics of what you need to build a successful business.