How to create usercentric NDAs for start up companies

The Challenge

To create flexible and new relationships in an established industry, global enterprises like AIRBUS Defence & Space often draw on fresh and new ideas from external partners, mostly start up companies. The first contact with these potential business partners starts with an NDA. For the majority of start up companies this is already a huge challenge, due to lack of inhouse lawyers. To get into business with large enterprises they sign NDA‘s without a clear understanding of what the meaning and consequences really are.

The Approach

To improve this situation, the contract innovators team of AIRBUS learned in a first Kick off workshop the Legal Design method. In a joined effort and collaboration with Lieke Beelen (VisualContracts), we prepared and conducted this workshop to let participants come into the flow of our special way of approaching challenges and to analyze the internal status quo of the problem at the same time. The team started with the assumption that “start up companies don‘t want NDAs and don’t take care too much about legal issues”.
Our following deep research phase in which we conducted intense interviews with all relevant stakeholders in the ecosystem of NDAs (Legal department, contracting department, procurement, start up companies etc.) showed a complete different view on this topic. The main finding of the research was that start up companies want their IP to be protected as much as possible by an NDA but wish for an agreement to sign, that is transparent, easy to access and understandable.

The Outcome

Based on these findings we co-created a first version of a re-structured, shortened and simplified NDA including explanations of legal expressions for people without legal background. The test with users showed not only potential  for further improvement but also the potential impact user centric contracts could expand: with the transparent and understandable NDA users felt understood and taken serious as a business partner. Remarkable on this project was that this trust building effect was triggered only by re-designing a contract!

Conclusion

Contracts are a way to communicate with business partners. Clear NDAs support a trustful partnership right from the start.