Why Signing an NDA Drives Tech Experts Mad

Do you know three letters that drive tech developers and IT companies mad? N-D-A. The holy abbreviation that is mentioned at the beginning of almost all deals stands for Non-Disclosure Agreement. Basically, it’s a legal duct tape that seals developers’ mouths. At least, the clients believe so.

NDA Psychology: Useless Paper Over Trust?

Originally, the NDA was designed to ensure confidential information, be it sales contract lists or non-public accounting figures, remained hidden. Partners and employees with access to sensitive data both usually sign the agreement, claiming that they will take the secrets to their graves — or at least until the agreement allows them to talk. The ultimate reason was to minimize data leakages, which may undermine business reputation and growth, or lead to loss of profits.

Imagine you have come up with a unique recipe and there’s nothing quite like it anywhere in the world. Guests experience unforgettable gastronomical pleasure and are ready to stand in lines for hours to try your iconic dish. Exactly the same happens when a new iPhone is released before customers start to place orders. Being an innovative chef or developer, would you share the secret ingredients of your mind-blowing products? Of course, not! You will ensure no one dares to feed the details to competitors or the public. And if they do, they will lose, not win.

In the pursuit of confidentiality and keeping corporate secrets safe, businesses became obsessed with NDAs. It’s no longer about confidential data but about project information from A to Z, project owners, founders, and partners. That’s what we at Plavno sign for every time.

As a result, developers who devoted their time and energy to creating a revolutionary product can’t utter a word about their contribution. Some companies justify this by claiming that they aren’t allowed to outsource development abroad. Others, however, merely don’t want anyone to know that the talented developers who built and maintain a digital solution are actually third-party engineers. The latter, however, isn’t a good excuse in the tech world, where even giants like Microsoft, Google, and Apple confess to hiring third-party experts. You can learn more about who really builds and supports your favorite digital solutions here.

Does an NDA Really Protect the Client and Intellectual Property?

The confidential information not to be disclosed varies from NDA to NDA. While strict agreements prohibit a developer or company from ever mentioning its involvement in the project, others are focused on core aspects like user data or confidential corporate records. Tech experts are more eager to sign not-so-tight agreements as it allows them to share their experience and build a reputation in the highly-competitive industry. Unfortunately for tech geeks, you are likely to sign an agreement that completely eliminates any involvement in the project.

By doing so, the clients are certain their secrets are secured by legal duct tape. But are they, really? Not at all. Imagine you caught a vendor who just admitted to developing your product. You rush to a fancy lawyer to initiate a legal process. Don’t forget that you will cover hourly rates, and the lawyer is going to need a lot of hours to collect evidence. In 99% of cases, it’s all he-said-she-said stuff, and your legal support will conclude with “there’s not enough evidence to take the case to court”. The show ends with you being unable to get compensation and a huge bill from the lawyer.

Why By Insisting on NDA You Put Sand on the Wheels of Your Development

If you think the only risk you bear when signing an NDA is the inability to sue your talkative partners, you are wrong. In reality, there are other potential pitfalls that may delay your development or even interrupt scalability and innovation.

• Lost networking opportunities between investors, developers, etc. Collective intelligence has always been key to faster scalability and efficient solutions. Imagine you seal investors’ lips with an NDA. On the one hand, you get a loyal partner who won’t say anything about your project. On the other hand, you lose potential investors that may boost your projects in the coming funding rounds. Besides, you will never get precious third-party feedback, which may help you eliminate inconveniences before even launching an MVP. The same applies to developers, who may find a better and cheaper solution to implement your idea.

• Challenges to attracting the right talent. Not all developers want to invest their time and effort into a project without being able to take credit for their involvement. Unfortunately, only a few clients are happy with half-empty portfolios, where all the logos or features are blurred because of NDAs. Therefore software engineers are more likely to work on a project without NDAs, or at least with less strict ones.

• A sign of distrust. Tech partnerships can last for decades if you share culture and establish efficient communication. Urging vendors to sign an NDA is basically a red flag that you consider them scammers who want to enrich themselves by selling your data and ideas. This is hardly a solid basis for successful long-term cooperation.

How to Safeguard Your Intellectual Property Forever

Those three holy letters — NDA — are hardly a warranty when it comes to outsourcing software development. Instead, they may scare tech experts away or become the basis of inefficient collaboration, which does more harm to your project than having your logo in someone’s portfolio.

But don’t get the message wrong: Plavno understands your urge to protect intellectual property. The thing is, an NDA doesn’t provide as much security as you think it does. At the same time, it denies your networking opportunities.

Patents are a far better option to protect your little pumpkin — in other words, your digital solution — from plagiarism. They will also eliminate all tedious paperwork since patenting has become so hassle-free that you can even file for it without an attorney’s support.

Stay safe and protect your ideas with ever-green methods that benefit your business rather than harm it.