Cash & runway
Burn rate and runway calculator
Enter your cash, spend, and collections to get gross burn, net burn, and the month your cash runs out.
Enter your cash, spend, and collections to get gross burn, net burn, and the month your cash runs out.
An estimate based on a flat monthly burn. Real runway moves with hiring, seasonality, and collections.
Burn rate is how much cash leaves the business each month. Runway is how long the cash you hold will last at that rate. Together they set the real deadline on everything else: when you must start raising, how fast you can hire, and whether you negotiate your next round from strength or from need.
Gross burn is total cash out — payroll, vendors, rent, tooling. Net burn is gross burn minus the cash you collect. Runway is measured against net burn, because that is what is actually draining the balance.
Net burn tells you how long you have. Gross burn tells you how exposed you are if revenue stops. A company with $200k gross burn and $190k net burn is in a very different position from one at $200k gross and $20k net, even though only the second looks comfortable on a runway chart.
The most common error in a runway model is using revenue booked rather than cash collected. A signed annual contract that invoices quarterly does not put a year of cash in the bank. If your customers pay on 30- or 60-day terms, your cash-in line should lag your revenue line by that much.
Common seed to Series A guidance is 12 to 18 months after a raise. Eighteen months gives roughly twelve months to hit the milestones for the next round and six months to run the process, which typically takes three to six months from first meeting to money in the bank.
Bands reflect common seed to Series A investor guidance, not a rule.
Runway tells you how long you have. It says nothing about whether the money is buying anything. Burn multiple — net burn divided by net new ARR over the same period — is the number that answers that, and it is increasingly what investors grade on. Enter net new ARR above and the calculator returns it alongside your runway.
| Burn multiple | Read |
|---|---|
| Under 1.0x | Amazing — each dollar burned bought more than a dollar of new ARR |
| 1.0 – 1.5x | Great, and the band most efficient venture-backed companies sit in |
| 1.5 – 2.0x | OK. Fine at seed, worth explaining by Series B |
| Above 2.0x | Growth is being bought with cash rather than earned |
Two cautions. Use net burn, never gross — the question is what the cash actually consumed bought you. And keep both sides on the same period: a monthly net burn against an annual ARR figure produces a multiple twelve times too low, which is the most common way this number gets quoted wrongly in a board deck. David Sacks’ original framing has the rest.
If your books are not current enough to trust these numbers, that is the problem to fix first. Our bookkeeping service keeps them current daily.