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You have agreed to work together. Now let’s get it in writing. Contracts are a dirty word for many entrepreneurs because it implies a lot of ‘legal mumbo-jumbo’ that slows the process of creativity.
A contract is simply a written record of the agreement between you and the other people involved in your idea, which is recognised as a legal obligation. Both parties define what’s in a contract and not the other way around. Think of contracts more like the minutes of the meeting where everyone agreed what you are going to do and how, then signed to proved it. It also protect both of you when the other doesn’t, can’t or won’t do what you had originally agreed to do.
They come in various shapes and one size does not fit all. As the owner of an idea one of the first contracts you could consider is a Non-Disclosure Agreement (NDA). NDAs allow you to share information about your idea with someone else with a legally recognised agreement that they won’t share it with anyone else.
NDAs can be:
One Way Non-Disclosure Agreements where it is one person sharing their confidential information with someone else or,
Mutual Non-Disclosure Agreements when everyone involved is sharing sensitive information about their ideas or businesses.
Here is a useful guide on NDAs from the Intellectual Property Office (UK). It is our strong recommendation that you involve a legal expert when drawing up any contract – even if you are modifying a template. It’s an investment which could literally save your business.