Non-Disclosure Agreement (NDA)
The contract that says: I'll show you the confidential stuff, you won't repeat it or use it for anything else. Signed before the real conversation.
See it
What it is
An NDA does three things: it defines what counts as confidential information, names the permitted purpose you may use it for, and sets how long the duty lasts. It is unilateral when only one side shares (a founder briefing a contractor) and mutual when both do (two companies sizing up a partnership). Every version carries the same exclusions: information already public, information the receiver already had, information independently developed, and disclosure compelled by a court.
Reach for one before sharing a customer list, unreleased product, source code, or financials. It does not unlock another client's data: existing confidentiality terms and privacy law decide whether you may show that at all, and a fresh NDA with a third party cannot override a duty you already owe someone else. Two clauses carry the weight: the purpose limitation (they may not use it, not merely may not repeat it) and the term, which is typically 2 to 5 years for general confidential information and open-ended for genuine trade secrets. A marking requirement ('must be labeled CONFIDENTIAL within 30 days') reads tidy and is the single most breached line in the document, because nobody labels anything.
Gotchas: an NDA creates a duty, not a property right. It can absolutely protect a confidential idea from being repeated or reused, but it does not hand you a patent, a copyright, or anything you can point at and call yours, so if the concept alone is your moat you are relying on the other side's fear of being sued. It is also not a non-compete and not an IP assignment: it restricts disclosure and use, it transfers ownership of nothing. And most investors decline to sign one at pitch stage, which is standard practice rather than a red flag.
Ask AI for it
Draft a mutual non-disclosure agreement between [Party A] and [Party B] for the purpose of [evaluating a potential engagement]. Include: a definition of Confidential Information covering oral and written disclosures with no labeling requirement; a purpose limitation restricting use to the stated purpose only; the standard exclusions (publicly known, already possessed, independently developed, lawfully received from a third party); a compelled-disclosure carve-out with advance notice to the disclosing party; permitted recipients limited to employees and advisers bound by equivalent duties; a 3-year confidentiality term with trade secrets protected for as long as they stay trade secrets; return or destruction of materials on request; an express statement that no license, IP assignment, exclusivity or obligation to transact is created; and a right to seek injunctive relief. One page, plain English, governed by the law of [jurisdiction].