I started a small business a few years ago, and thankfully the business is growing. In fact, I am at a point where I am preparing some proposals to pitch to prospective investors and partners. Also, I will need to employ some more workers. But, I have a fear. I will have to share some very intimate details and data of my company to both the potential investors and the employees. How can I protect my trade secrets and data especially if I get to change staff or they eventually don’t invest? Please help me Zainab.
Hello Young CEO,
I am so excited to hear that your business is growing. This is because lately I have been reading and hearing of people closing down their businesses. I do hope too that you will continue to do your best and do the right things to continually grow your business.
Now, I do understand your fear and it will be foolish to say they are unfounded. Many companies have lost amazing ideas, concepts, and some have lost resources because they frivolously handled information they should have handled more delicately.
What you need is called a NDA- Non Disclosure Agreement. Simply put, the non disclosure agreement helps protect the privacy of your business’ confidential information. You use the NDA when you are about to disclose confidential information about your business to a person, an organisation or body. It binds the party you have given important details about your business from disclosing it to any other person without prior approval from you. However, your NDA is of no use unless both parties involved sign it. It is important that you think about those who will have access to your information before disclosing it and ensure that they have signed and will keep to their word.
Now, the NDA isn’t something to use at every instance you have some information to share with anyone. Here are some ideal situations where the NDA is suitable:
When you are about to show a new product or technology to a prospective buyer
Sharing a potential business idea to investors or partners
Sharing your financial information or marketing strategy with another party
When you allow an employee to access confidential information about the business during the course of their jobs.
I hope this calms your fear. Also, this post on the DIY Resources blog shows you much more. You should read it.
So, keep succeeding Young CEO.