# What is NDA? Definition & Technical Mechanics

> **Source:** [SPIDITS AI Startup & Venture Intelligence Glossary](https://spidits.com/startup-glossary)  
> **Category:** Legal  
> **Canonical Citation:** [https://spidits.com/startup-glossary/nda](https://spidits.com/startup-glossary/nda)

## Definition
An NDA (Non-Disclosure Agreement) is a legally binding contract that restricts parties from sharing confidential information disclosed during discussions.

## Architectural Mechanics & Deep Dive
An NDA (Non-Disclosure Agreement) is a legally binding contract that restricts parties from sharing confidential information disclosed during discussions (such as partnerships, hiring, or acquisition talks). While common in corporate transactions, most venture capital investors refuse to sign NDAs during early-stage pitches because they review hundreds of similar pitches and want to avoid legal conflicts.

## Industry Applications & Real-World Use Cases
Corporate partnership talks and employee contracts

## Frequently Asked Questions

### Do venture capitalists sign NDAs?
Almost never. VCs review hundreds of similar deals and signing NDAs would expose them to constant legal liability.

### When is it appropriate to use an NDA?
During commercial partnership discussions, hiring contractors, or technical integrations involving proprietary IP.

## Related Terminology
- [term-sheet](https://spidits.com/startup-glossary/term-sheet)
- [due-diligence](https://spidits.com/startup-glossary/due-diligence)
- [option-pool](https://spidits.com/startup-glossary/option-pool)

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*From the SPIDITS AI Knowledge Base (300+ terms indexed). Explore full technical definitions: [https://spidits.com/startup-glossary](https://spidits.com/startup-glossary)*