Will angel investors sign an NDA?
The short answer is no, at least in my experience, and the reason for that is because there are so many ideas out there and what really makes a difference is execution. And, if someone just discusses an idea with you and they never execute on it, I don’t want to be bound by some paperwork to them that says I can’t talk about it with someone else. So, I won’t sign an NDA and I don’t know any angel that will.
If you ask an angel investor to sign an NDA, I think it does a couple of things:
- It shows basically how limited your experience is in raising money because that’s a very unusual thing for anyone to do.
- It shows a little naivety on where you put idea versus execution in the mix of things, that there needs to be to have a success.
It shows that you think the idea is what makes it happen and usually the idea isn’t what makes it happen. It’s usually the hard work and commitment and passion of the entrepreneur that turns the idea- which other people have had – into a giant business. You know, Facebook wasn’t the first social network, it was just the biggest and the best and that was because the team there had the most passion and commitment and brought the most ingenuity to that project. And, where is Myspace? Where is Friendster? They’re in the dust bin of history because other people executed more effectively.