[anthonyskipper]

The advice here is terrible and the opposite of what it should be. I've seen tons of startups screw this up and wreck great opportunities. Yes, you need a lawyer to review the contract, but you should just sign it and move along if the lawyer says it looks ok. Mutual NDAs are standard fair in the business world, especially from an established company.

[rlucas]

The problem here is confusing something that might be "standard fair in the business world" with something that is very much out of market in the startup investor world.

If OP is entertaining a commercial relationship with an established, larger company -- and there might be an investment component alongside that (a "strategic" investor) -- then it generally makes sense to play normal commercial relationship rules. And one of those is that a BigCo generally gets what it wants in terms of NDAs, within reason, before it opens up.

But if OP's investor purports to be a "real" investor (financial and serial) then there are serious yellow/red flags.

(A "real" investor is one who is financially motivated but also has interest in doing several deals in the community into the future -- hence, they have a reputation to protect and they will tend to hew closer to market norms.)

From the VC perspective, if I had a good customer lead (in my portfolio or otherwise) for a new application of an unfunded startup's technology, I would unhesitatingly make the intro. It benefits me several ways: 1. it may help the customer; 2. seeing how the customer responds is extra diligence information to help me form an investment perspective; 3. if it works out, I am viewed favorably by the startup and more likely to have my term sheet accepted going forward. (This is not speculation; in fact, I am a VC and we do this sort of thing all the time.)

It would be a strange situation, indeed, where I would feel the need to forgo those benefits because of needing an NDA.

(Now, if it's the end customer who wants the NDA, then the normal "commercial relationship" rules, above, apply.)

[chews]

I came here to basically say the same thing, I've raised from amazing investors and raised from mediocre ones. One thing is certain, while an investor has a lot of pull in companies, nothing statistically has screwed them up more than entrepreneur naiveté. Truth of the matter is that founders screw companies far more frequently than investors do, because they intrinsically feel right in every situation, their cognitive bias is introduced into every decision. NDAs are part of the standard practice of business, if you can't get past that, this whole process is going to be fraught with a lot more anxiety. Good luck.

[rilita]

"Everyone else is jumping off the cliff. Just go with it."

Just because other people agree to such ridiculous conditions, and they are not typically abused, does not mean that it doesn't happen.