Time for an NDA Redesign: Airbus’s Approach to Startup Partnerships

Listening to Season 29 of Wondery’s Business Wars, it’s clear that AIRBUS is outpacing its competition. Several factors contribute to AIRBUS’s dominance, but one stands out: its corporate culture of innovation[1] extending even to its legal and procurement teams. As of at least 2015, AIRBUS has a “contract innovators team” that seeks to improve contract digitization and procurement.[2]

A few years ago, this multinational aerospace corporation took an innovative approach to its non-disclosure agreements (NDA) (I can imagine the eye rolls and sighs but trust me—this NDA is different. Keep reading).

The Role of NDAs in Business Innovation

As many SLAW readers will already understand, when separate entities consider collaboration or a business relationship, they often enter into an NDA. The NDA enables the exchange of proprietary and confidential information, which in turn can foster innovation, partnership, mutual success and prosperity. However, when transactions breakdown, one party can cause real and lasting damage to other if they use of confidential information or benefit from information received. In some cases, it is the NDA that is the starting point of lasting collaborations.

To maintain its competitive edge in aerospace technology, AIRBUS frequently partners with start-ups and small businesses. However, AIRBUS’ motto, “No contract. No flight,”[3] presented an obstacle when engaging with smaller corporations. Start-ups seeking to work with the aerospace giant had to sign an NDA, but many lacked legal counsel, misunderstood the risks, or struggled with complex legalese.[4] The lack of a standardized NDA led to confusion and delays—problems that could stifle innovation at AIRBUS.[5]

The Redesign: Simplifying the NDA Process

Initially AIRBUS assumed that, “[s]tart-up companies don’t want NDAs and don’t care too much about legal issues.”[6] However, intensive user interviews and research revealed the opposite: start-ups prioritized IP protection and valued agreements that were transparent, accessible, and easy to understand. They also asked for, “trustful communication on an equal footing.”[7]

AIRBUS embarked on a redesign project for its NDA. With the help of external consultants and legal designers, AIRBUS simplified the language, restructured the layout, and enhanced clarity to improve readability. The result? A more efficient and user-friendly agreement that reduced friction and accelerated partnerships (see AIRBUSs NDA).[8]

Lessons for Legal and Business Professionals

Both private and in-house counsel will appreciate AIRBUS’ NDA evolution. Throughout my career, I’ve reviewed and negotiated several NDAs, particularly for start-ups eager to protect their IP but cautious when negotiating with larger, more experienced business partners.

On the corporate side, I’ve also seen legal and procurement teams use overly complex and restrictive NDAs—sometimes out of habit, sometimes as a legal security blanket, and sometimes simply because that’s the language they’ve “always used”, or it was embedded in their procurement system. However, overly rigid NDAs can deter potential innovation partners.

While an NDA may seem like just another contract, it’s often the foundation of a business relationship and deserves thoughtful drafting.

Considerations for In-House Legal Teams

If you’re in an in-house role, ask yourself:

• Is your NDA fair or is it overly one-sided? Consider whether it truly needs to be drafted entirely in your company’s favor or if a more balanced approach could foster better collaboration. If your company stands to benefit from a start-up’s innovation, does your NDA fairly address their IP concerns (or other concerns)?
• Does your NDA use complicated legalese? If so, can you simplify the language to increase readability?
• Does your NDA stifle innovation? Put yourself in the other party’s shoes. If you were the start-up, would you hesitate to sign your company’s NDA?
• Can you improve transparency? Consider including an FAQ to clarify the NDA process. Many start-ups are working with a large company for the first time—guidance can make the process smoother (without offering legal advice, of course).

Considerations for Start-Ups

If you’re a start-up:

• Does the NDA protect your most valuable assets? Ensure that the IP clause is rock-solid—your business depends on it.
• Develop a checklist. Identify key issues to review in every NDA before signing.
• Don’t just sign the NDA. Ask for clarification and negotiate amendments when needed.
• Hire a lawyer. While there’s a cost, failing to understand the NDAs terms could create far greater risks (and much more in costs) down the line.

Final Thoughts

NDAs may seem like legal formalities, but they set the tone for budding business relationships. Whether you’re a corporate legal team or a start-up, rethinking your NDA can remove unnecessary friction, foster collaboration, and accelerate innovation. Like AIRBUS, ask yourself: How can we simplify, clarify, and improve?

In an era where speed and innovation define success, an NDA shouldn’t be the first roadblock that companies face — it should set the tone for the entire corporate relationship. Take a look at your NDAs and if they might be hinder progress and innovation, perhaps it’s time for a redesign.

______________

[1] David Brown, “Boeing vs Airbus”, Business Wars, Season 29 (Podcast: Wondery).

[2] Astrid Kohlmeier and Meera Klemola, The Legal Design Book – Doing Law in the 21^st Century (2021: Astrid Kohlmeier & Meera Klemola) at p. 195.

[3] Ines Curtius (Speaker), AIRBUS: How to design user centric NDAs for start up companies?, Monthly Meetup #2 21022020 (Online: 2021).

[4] Ibid Kohlmeier at p. 196-197.

[5] Ibid Cutius.

[6] Ibid Kohlmeier at p. 195.

[7] Ibid Kohlmeier at p. 196.

[8] Visual Contracts, User friendly NDA (Online). NOTE: There were several design thinking steps taken to get to this redesigned NDA. For more information about the design thinking process, refer to the resources or blogs available at Visual Contracts’ website (https://visualcontracts.eu/).

The post Time for an NDA Redesign: Airbus’s Approach to Startup Partnerships appeared first on Slaw.