Every founder has watched an NDA sit in a counterparty's legal queue for three weeks and come back with a redline that eats the deal. It's almost never about the confidentiality obligation itself.
What actually stalls an NDA
- A perpetual term with no expiration.
- A definition of "Confidential Information" that captures anything the recipient hears in a hallway.
- A governing-law clause pointing to a state neither party operates in.
- One-way structure when the conversation is genuinely two-way.
Any one of those triggers a mandatory redline. Two of them delays the deal past its useful window.
The shape that gets signed
Four decisions, all before you draft:
- Mutual or one-way? If either side might disclose anything, make it mutual. It removes half the redlines.
- Term. Three to five years is standard for commercial NDAs. Trade-secret carve-out for indefinite protection is fine; a blanket perpetual term is not.
- Purpose. Tie permitted use to a specific evaluation - "evaluating a potential integration" - not "the business relationship."
- Governing law. Pick a jurisdiction one of you actually operates in.
The tone
An NDA is a trust document. Aggressive language ("Recipient acknowledges the extraordinary and irreparable harm...") signals that you don't trust the counterparty, and they respond in kind. Neutral, precise language moves faster.
Draft one with the NDA Generator.