As a founder, one of the quickest ways you can kill a conversation with a customer or investor is to NDA - Non-Disclosure Agreement - up.

Why?

In venture capital, we hear thousands of pitches a year, often from similar companies. Signing an NDA every time we meet a company would be logistically impossible.

Likewise for your customers. After all, how can they build confidence in your product and ability to deliver if you won't share the details with them?

If you NDA up to early, it can:

• sabotage your ability to build a trusting relationship,

• give customers a reason to walk away,

• give investors a reason to walk away.

So how do you walk the line as a founder of protecting important details while still being open?

What is the nature of the data I am worried about sharing and why?

Odds are the decision to apply an NDA comes down to the desire to protect data that is not publicly available. It is important to ask not only 'what' should be protected, but also 'why' and 'so what'.

For example: If revealing unprotected IP will compromise the core of your company's value, what is a way that you can build confidence in the product's uniqueness? Can you demo, do a lab walkthrough or talk broadly about the innovation?

It is possible to protect what is unique, and build confidence at the same time.

It is possible to have two things be true at once: protect confidential data, while sharing the necessary data to build confidence in your company.

What we have seen work best are staged data rooms:

• The first, allows investors to get on with evaluating your business.

• The second contains data with a higher threshold of security, such as trade-secret IP, which can be shared once a trusted relationship has been established by both parties.

• Bonus - be clear with investors about what they can share during diligence with customers and co-investors.

Instead of being proactive in locking everything up, which slows progress.

Be proactive in removing barriers to building trust, this speeds up progress.

When it comes to protecting your competitive advantage, you have to do what is best for your company. We believe that you can protect what is unique and build confidence at the same time.

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Agree or disagree? Let me know on @AlezeiaB