Not all inventors want or can go through the process of registering a patent or commercializing their invention themselves. Some inventors want to find an investor who will enable them to continue development, manufacturing, and marketing of their invention.
In any negotiations with a potential investor or company involved in commercializing patents, it is very important to ensure confidentiality by means of signing nondisclosure agreements prior to negotiations. A nondisclosure agreement is especially essential for technical reasons: To prevent claims that disclosing an invention to investors constitutes its prior publication, that would make it ineligible for patent registration.
Part of the importance of the nondisclosure agreement involves a certain assurance that the idea on which the invention is based will not be used by potential investors to develop a competing product at the same time. With that, it is important to remember that a nondisclosure agreement only provides limited protection and there are other methods for protecting an invention that we recommend taking concurrently.
Before exposing an invention to any entity, we recommend that you obtain legal advice that will prevent critical problems in the future.