Default Alive

A company is default alive if it can reach profitability on its current trajectory without raising additional external capital. Coined by Paul Graham of Y Combinator.

Default alive companies have negotiating leverage in fundraising conversations. They can choose investors rather than taking any term on offer. In down markets, being default alive is the difference between thriving and shutting down.

Your revenue grows 15% month over month and your costs are flat. At this trajectory, revenue exceeds expenses in 7 months without any new funding. You are default alive. You raise anyway, from a position of strength.