The WTFs of a Business Angel: # 2 The NDA fallacy
When we started SpeedInvest about 18 months ago, we were a startup ourselves. A very well funded startup, but still, we were a team of people who had some experience in building companies and no experience in building a Business Angel fund. We are still learning an awful lot, because you can profit from other people’s wisdom, but there is no way around doing things yourself, making mistakes, trying again and again, learning from what you’ve seen so far. That is the spirit that we like to keep, a positive and pro-founder type of attitude, because the truth is: we love what we are doing. It is fun and exciting to meet visionary people, who have drive and enthusiasm to change whatever tiny bit of their world, step by step. However, there are those rare events where we sit across the table in our office and are having a facepalm moment. When one of us gets an email from a startup or reads a piece of news about our industry that just makes you go “WTF?”. For your reading pleasure, but also to offer you the opportunity to learn, we open up our treasure chest of awkward moments and give you our top WTFs, of course with all due respect to those contributing to them.
# 2 The NDA fallacy
It should be conventional wisdom by now, but it still happens more often than you would think: entrepreneurs that want to work with us, ask for an NDA, a non-disclosure agreement. This, however, is hardly managable for us. Our job is to look at startups and their business ideas. We do this on a daily basis and have seen well over 500 startups in the past 18 months. If you consider the number of pitches we receive at conferences, startup lives and other events, this number may well rise to over 2.000.
If we signed an NDA with every company we talk to, we wouldn’t have time to work with all the great entrepreneurs that we end up investing in. So please, trust us. Apart from the fact that many ideas are not as unique as they may seem in the beginning, we are actually dependent on your trust and that of everyone else, because we intend to stay in this business for a while.
Even if we do not end up making a deal with you, we know that our industry is small, tightly knit and builds on the trust of all parties involved. I once heard a Slovenian entrepreneur on stage talk about ideas and his business. He said “I have an idea every day. Ideas are shit, they are worth nothing. It’s the execution that counts, so please, go ahead and talk about your idea, that is the only way you get valuable information for executing on it”. Damn right.