Over the past 6 months, we’ve gone from the longest bull run in history (3,453 days) to what some are calling the “worst economic downturn of a lifetime”. In response, the mantra of “growth at any cost” has been brought to the forefront of the minds of VCs, who have asked their port-co’s to pull back. It initially hit the public companies, followed by the late stage private companies, and slowly but surely it made its way to the earlier stage startups as well. “Growth at any cost" works when capital is cheap and abundant. But in periods of economic contraction, when capital becomes exponentially more expensive, the unit economics may no longer work and capital-intensive businesses run the risk of becoming insolvent. Getting to “default alive” has never been so important—and we’re here to help.
Today we are announcing the Default Alive Coalition—a joint venture between tech companies, VCs and bootstrapped founders to help startups extend their runway and sustain their growth through the changing macro environment. Launched in partnership with Fondo, Workato, Forecastr, Spekit and several other tech companies, the default alive coalition is a direct response to the warning bells sounded by venture capital firms across Silicon Valley. Together, we’re providing discounts to capital and the key services startups need to operationalize their success.
You might be wondering why having access to these discounted tools is important—the answer is simple: cash burn is coming under increased scrutiny as market conditions worsen.
For context, typically, there is a time gap between the initial investment in growth (e.g., a new marketing campaign or strategic hire) and the eventual bump to top-line revenue. For most early stage venture-backed startups that do not cash flow, time is not on their side. When they invest in growth, their runway immediately takes a hit—they’re betting that the effort will pay “dividends” in short order, increasing their chance of getting to breakeven.
In a down environment, the last thing a company wants to do is choose between levers that drive growth vs. keeping the lights on. If they only keep the lights on their likelihood of success is minimized, because other more well-capitalized competitors who invest in growth will gain market share. If they only focus on growth and lose sight of the north-star goal of staying alive, they face increased odds of becoming insolvent.
We started the coalition to empower founders to do both: keep the lights on and grow sustainably—that is something we are truly proud to be a part of.
So what does “default alive'' mean and how do you get there?
An organization becomes ‘default alive’ when they can get to cash flow neutral with their current cash on hand. The process to become default alive is three pronged: cutting expenses, bolstering revenue, and raising strategic capital. Securing funding through an Arc Advance allows you to focus your efforts on the other two levers. Cutting expenses and bolstering revenues can be challenging, especially when cutting the wrong expense can negatively impact revenue—but with the right tools (i.e., the tech providers that are a part of the default alive coalition) you can do just that.
By now you’re probably wondering what discounts you’ll receive access to from the Default Alive Coalition. Here’s a high level breakdown of the discounts and offers you can expect when you become a member:
- Arc — providing a 15% discount on its debt-and-dilution free financing.
- Fondo — providing $1100 worth of “Bookkeeping”, “Tax” and “Tax Credits”.
- Morphic — providing 25% off its no-code website design & dev tools.
- Powtoon — providing 15% off its video content creation platform for HR and L&D leaders.
- Workato — providing a 30-min workflow automation consultation.
- Mailmodo — providing up to 50% discount on its email marketing platform.
- Forecastr — providing 25% off its financial modeling software.
- Demostack — providing 15% off its no-code tailored demoing software.
- Spekit — providing free sales enablement consultation.
Don’t just survive the next year, thrive by leveraging the discounted tools included as part of the default alive campaign. To access the discounts related to the default alive coalition, and for the full list of participating partners visit: arc.tech/default-alive/.
Frequently Asked Questions:
The Default Alive Coalition is open to any startup that is looking to bolster its financial position while focusing on growth. Each of the software providers in the Default Alive Coalition may have their own qualification criteria so startups are strongly encouraged to reach out to make sure they qualify for a discount.
How do I take advantage of the discounts?
To access the discounts related to the Default Alive Coalition or view the full list of participating partners visit: arc.tech/default-alive/.
What if I only want one or two of the discounts?
No worries. Simply complete the form found at the top of the landing page to show your interest. We’ll follow up with additional information around how you can redeem your discount.
I represent a VC firm and I’d like to offer the Default Alive Coalition discounts to my portfolio companies. What’s the best way for me to go about doing that?
VCs are strongly encouraged to share the Default Alive Page directly with their companies. If you’re looking for more customized marketing collateral, please reach out to us at email@example.com.
I’m a tech partner and I’d like to offer a discount. How do I join the coalition?
Email us at firstname.lastname@example.org.
I’m a journalist and I’d like to cover the Default Alive Coalition. How do I get in touch?
Please direct all media enquiries to email@example.com.