If you have an idea for an app and need the input of others, you need to ensure this idea is protected. You may need to use non-disclosure agreements (NDAs) or confidentiality agreements to ensure the information you share remains confidential. NDAs are a common agreement, particularly in the startup and app development industry. This article outlines when you will need to use an NDA and what you can protect with one.

What is an NDA?

An NDA is an agreement between two parties when either one or both parties will disclose confidential information during their business relationship. An NDA will clearly outline the obligations of each party, which typically includes to:

  • not share any confidential information with any parties outside of the NDA;
  • treat the confidential information with the same care and respect as the party sharing the information;
  • only use the confidential information for the purposes outlined in the NDA;
  • protect the information from unauthorised disclosure and notify parties to the NDA of any breaches; and
  • only share confidential information to others on a need-to-know basis.

Mutual or One Way?

An NDA may be mutual or one-way. If both you and the other party intend on sharing confidential information, then a mutual NDA may be more appropriate. Here, both parties have obligations to ensure information shared is not disclosed to the public. 

Alternatively, if you are the only one sharing confidential information, a one-way NDA may be more suitable.

What Does an NDA Protect?

When drafting an NDA, you can define what is protected as confidential information. Your NDA should cover all types of documents you share to ensure that your idea is as protected as possible. An NDA can be drafted to protect your:

  • app functionality;
  • designs;
  • source code;
  • business plans;
  • business model; and
  • notes.

Your NDA should also clearly outline its purpose. 

For example, if you are discussing your idea for your app with an app developer who will provide you with a quote, your NDA should state this. This allows the app developer to then only use the confidential information you provide to them for the purpose of providing you with an accurate quote.

Market Research

Conducting market research can be crucial in refining your idea for your app and guiding your decisions about: 

  • design;
  • development; and 
  • marketing your app.

Surveys and focus groups can be a great way to obtain opinions and feedback from third parties. Before sharing your idea with the survey or focus group participants, you should ensure that they sign an NDA to protect any information you share about your idea and plans for your app. 

Engaging a Developer

Choosing the right developer for your app is crucial to its success. Therefore, doing your research and talking to different developers can be useful. Before initially discussing your app with any prospective developers, you should request they sign an NDA. Requiring any prospective developers to sign an NDA prior to discussions ensures that any information you provide is kept confidential. 

Once you have found a developer you would like to work with, a subsequent development agreement that outlines the development services should be implemented. This agreement will not only protect any further confidential information you share with your developer but also outlines:

  • specifications of their services;
  • time and cost guarantees;
  • a development schedule and acceptance testing;
  • warranties and indemnities;
  • intellectual property provisions; and
  • payment.

Developing your app can be a complex process, and having a development agreement in place protects your confidential information. It also ensures that you and your developer are on the same page.

Building Your Brand

Marketing or public relations agencies can help with identifying and implementing strategies and techniques to build your brand and attract users to your app. If you are looking for the best marketing agency to help launch your newly developed app, you will be sharing confidential information about: 

  • the functionalities of your app; and
  • your business plans.

Having an NDA in place ensures that any marketing agencies you discuss your app to keep the information you discuss confidential.

Upon engaging a marketing agency, a subsequent service agreement or terms and conditions document is necessary to outline the entire arrangement between you and the marketing agency. The terms and conditions should specify the exact services the marketing agency will be providing you. 

For example, the terms should be clear about whether the marketing agency will assist you with social media marketing and search engine optimisation.

Hiring Employees or Contractors

Many successful businesses scale quickly, so you may want to consider bringing on employees or contractors to assist with running your business and ensuring the continued success of your app. Hiring the wrong person can be detrimental to your work environment and can be time-consuming to deal with. Hiring the right person, however, can work wonders for productivity and make a positive impact on your business goals. 

When conducting interviews and sharing any information about your app, an NDA can prevent the interviewee from taking the confidential information you share to a competitor or from creating a competing app.

After deciding on the best people to join your team as an employee or contractor, you should draft either an employment or contractor agreement between your business and them. The type of agreement will depend on how you plan on engaging your workers and their roles.

Both agreements will dictate your relationship with your workers and set expectations out clearly to reduce the risk of any future misunderstandings and disputes. Both agreements will also prevent your workers from disclosing any confidential information about your app and business to the public or competitors.

Key Takeaways

Having a well-drafted NDA in place before discussing your idea for your app with any third parties is a good step to ensure the information you share is kept confidential. It is crucial to remember that when engaging third parties, a subsequent agreement outlining the specifics of the arrangement is also necessary. An NDA does not protect your intellectual property or detail the essentials of a business relationship. If you need assistance with drafting an NDA to ensure your idea for your app is protected during initial discussions, contact LegalVision’s contract lawyers on 1300 544 755 or fill out the form on this page.

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