10 Things a VC Would Rather Do with Your NDA than Sign It

A non-disclosure agreement — an NDA — is a legal document signed by at least two parties prior to sharing confidential information. It’s intended to prevent one party (or, in some cases, both parties) from sharing the information with people not involved in the meeting itself. It’s also a surefire way of destroying any chance you have of getting investment from a venture capitalist. Do you know why?

Asking a venture capitalist to sign an NDA at the start of a meeting is the equivalent of wearing a giant sign around your neck that says: “You’re better off setting fire to your money than giving it to me because you’ll waste less time and the heat might keep you warm for a little while.” It tells VCs you’re an amateur who doesn’t understand three important things.

First, it signals to venture capitalists you don’t have empathy for the people you’re talking to. In this case, you haven’t considered the job requirements of an investor. Investors meet with dozens of companies each week, and many of those companies have similarities based around the investor’s investment thesis. By signing your NDA, they could inadvertently put themselves in a position of not being able to discuss something necessary for considering another investment. They can’t take that risk, and the fact you aren’t able to anticipate the problem you’d be…