Can you refer a company you learned about under an NDA?

What is the short answer on referring a company after an NDA?

Usually not on the strength of the NDA alone. Most NDAs allow the recipient to use confidential information only for a stated purpose, typically evaluating a transaction. Using what you learned in a deal process to start a different commercial conversation, especially one that pays you, can fall outside that purpose. The safe path is the owner's direct permission, given in writing, and never reusing the confidential material itself.

What the rule says depends on the agreement's wording and the governing law, so this page explains the common patterns and the questions to put to counsel. This is general information, not legal, tax or financial advice. Confirm with your own counsel, tax adviser or professional body before acting.

What do NDAs and CIMs usually restrict?

Read the agreement itself, not a summary. These clauses decide the answer.

• Permitted purpose. The recipient may use the information only to evaluate or negotiate the named transaction. A referral to a data-licensing program is a different purpose.
• Definition of confidential information. Often broad: the CIM, management meetings, data room contents, the fact that the company is for sale, and your notes.
• Derived material. Notes, models and analyses you prepared from the information are commonly covered too.
• Non-solicitation and no-contact. Some NDAs bar contacting employees, customers or the owner other than through the sell-side banker.
• Return or destroy. After the process ends, you may have to return or delete the material, which also limits what you can rely on later.
• Duration. Obligations often last for years after the deal fails or closes.

Whether any of this applies to you depends on whether you signed, whether your firm signed, and what the text says.

How does it apply in common advisor situations?

When in doubt, treat the NDA as controlling and ask the owner first.

What does the safe path look like?

The question is whether the introduction depends on anything you only know because of the NDA. If it does not, and the owner agrees, it can usually proceed. If it does, stop.

1. Separate the sources. List what you would say and where each fact came from. Keep only facts that are public or that the owner shares with you now.
2. Ask permission from the owner directly, in writing, for a different purpose: an introduction to a data-licensing program. Do not reference deal terms or confidential figures.
3. Check the agreements. Have your counsel read the NDA, any engagement letter and your firm's policy.
4. Make the introduction using your own words, not the CIM's. The introduction email builder helps you prepare a note the owner can approve.
5. Share only basic fit information, such as size, years of operation and sponsor contact. Never export, upload or describe confidential records.

You do not need the CIM to screen. The baseline is 50+ full-time employees at peak (contractors excluded), several years of documented operations, rights to license the records and an authorized sponsor, and you can check headcount through public sources as in finding a private company's employee count and confirm the legal entity as described in how to find a company's legal entity name.

Does the NDA stop the company from licensing its own data?

Not by itself. The NDA binds you, not the company's ability to run its own business. The company decides whether to apply, and it can apply directly at sourcex.si/apply without you. Whether you receive credit then depends on the published terms and the attribution rules.

Separately, the company may have its own confidentiality promises to customers and employees. The FTC has said that promises not to use customer data for undisclosed purposes such as training models are enforceable. SourceX reviews rights with the company before any buyer sees anything, and de-identification and redaction rules are agreed before work begins. For M&A advisors in particular, the referral opportunities for M&A advisors page covers the wider role.

What if the company is being sold or has been acquired?

If a sale is live, coordinate with the deal team and the sell-side banker; the process may restrict side conversations. If the company has been acquired, the records and the decision-maker may have changed; see whether your referral credit survives an acquisition. If the company sits under a sponsor, introducing through the sponsor or the CEO covers who to approach first.

How do rewards fit in?

Partners earn 25% of the eligible platform fees SourceX actually collects from the referred company's licensing deals, capped at $100,000 cumulative per referred company, payable only after the buyer pays and SourceX receives its fee. No reward is guaranteed. If you are a registered representative or other regulated advisor, your firm's rules on outside compensation also apply.

What to ask your counsel

• Does the permitted-purpose clause cover this introduction, or only the original transaction?
• Does the no-contact clause bar me from approaching the owner?
• Which of my notes count as derived material I must destroy?
• Does my engagement letter restrict side arrangements involving the client?
• What written consent from the owner would satisfy the NDA?

Next step

If the owner has agreed in writing and nothing in the NDA stands in the way, register as a partner and make the introduction. If you are not sure, stop and ask counsel first; read how it works while you wait.