NDA's

They come up all the time, Non Disclosure Agreements. Most investors say "NO" to these if it comes up before they see an executive summary or business plan. For the rare people who can get an NDA before presenting a business plan, none of them are reading this blog.

Why do investors say "No"? The litigation that can be involved if we pass on the first investment and then try to make an investment in a similar company later on will be horrendous. There could be many reasons why a company was passed, sometimes it's technology, management, other times it's timing, mood of the investors, etc.

We also can't help you, do research on you, if there's an NDA in place. Most of our intelligence happens outside the board room, times when there's something interesting and we will mention it in passing during a cocktail hour. If we're not allowed to talk about a deal, most of the time we hamper our own worth as an investor.

Finally, most of us are working as investors. Looking to find good investments, and manage them. Few, not many, but enough, are actively looking for a company to join. But setting up a company using your idea as basis, unless there's expertise, knowledge, and the ability to see the fatal flaw in your plan, it's unlikely that we're going to leave the spacious office, with plush carpeting to live on the processed food life of a start-up.

Do your homework on your investors, see if they understand the space, look at their current portfolio of investments, see who made those investments and when.