What This Calculator Does
The Burn Rate & Runway Calculator helps startup founders, CFOs, and business owners answer the most critical financial question: **how long can your company survive before running out of cash?**
Enter your current cash balance, monthly expenses, and optional revenue to instantly see your gross burn rate, net burn rate, runway in months, and the projected date your funds will be exhausted. Whether you are preparing for a fundraising round, managing a bootstrap business, or monitoring post-funding spending, this tool gives you a clear picture of your financial runway.
The calculator supports two input modes. You can enter a single total for monthly expenses, or break expenses down into individual line items such as salaries, rent, software, and marketing for a more detailed view of where your money goes each month.
How It Calculates
**Core Formulas:**
\`\`\` Gross Burn Rate = Total Monthly Expenses Net Burn Rate = Monthly Expenses - Monthly Revenue Runway (months) = Cash on Hand / Net Burn Rate Runway End Date = Today + Runway (months) \`\`\`
**Gross burn rate** represents total monthly spending regardless of revenue. This is useful for understanding your full cost structure.
**Net burn rate** subtracts any monthly revenue from expenses, showing the actual rate at which cash reserves are depleting. If your revenue exceeds expenses, your net burn rate is zero and runway is effectively unlimited.
**Monthly cash flow** is the inverse of net burn rate. A positive number means you are generating surplus cash each month; a negative number means you are consuming reserves.
**Example:** If you have \$600,000 in the bank, spend \$80,000 per month, and earn \$20,000 per month in revenue, your net burn rate is \$60,000 and your runway is 10 months.
Understanding Runway Health
The calculator assigns a health status to your runway based on widely accepted startup finance benchmarks:
- **Healthy (green, 12+ months):** You have over a year of runway. This gives you time to iterate on product, hire, and grow without immediate fundraising pressure. - **Caution (yellow, 6-12 months):** Time to start planning your next fundraise or revenue push. Most venture fundraising processes take 3-6 months, so beginning now gives you a buffer. - **Critical (red, under 6 months):** Urgent action is needed. Consider cutting non-essential expenses, accelerating revenue, or seeking bridge funding immediately. - **Sustainable (green, unlimited):** Your revenue exceeds expenses. The business is cash-flow positive and does not depend on reserves to operate.
Who Should Use This
- **Startup Founders:** Track runway after a funding round and plan when to start the next raise. - **CFOs and Finance Teams:** Monitor monthly burn and forecast cash-out dates for board reporting. - **Freelancers and Solopreneurs:** Understand how long savings will last if client revenue drops. - **Investors and Advisors:** Quickly evaluate a portfolio company's financial health during check-ins. - **Non-Profit Leaders:** Manage grant funding and operational budgets with clear runway visibility.
How to use
1. Enter your total cash on hand — this is your current bank balance plus any liquid reserves 2. Optionally enter your average monthly revenue to calculate net burn rate 3. Choose between entering a single total for monthly expenses or an itemized breakdown 4. If using itemized mode, add or remove expense line items and enter amounts for each 5. Review the runway result, health indicator, and detailed metrics that appear automatically 6. Use the breakdown table to see weekly and daily burn rates for more granular planning
Tips for Extending Runway
If your runway is shorter than you would like, consider these strategies:
- **Audit expenses monthly.** Subscriptions, unused tools, and over-provisioned services add up quickly. Cutting 10-15% of discretionary spending can add months to your runway. - **Increase revenue before raising.** Even modest revenue growth improves your net burn rate and strengthens your position in fundraising conversations. - **Negotiate payment terms.** Extending vendor payment terms from net-30 to net-60 can temporarily improve cash flow. - **Delay non-critical hires.** Each new hire typically adds \$8,000-\$15,000 per month in fully loaded cost. Prioritize hires that directly drive revenue. - **Consider bridge financing.** If you are close to a milestone, a convertible note or SAFE can provide a few months of additional runway.
FAQs
Q: What is burn rate? A: Burn rate is the speed at which a company spends its cash reserves over a given period, typically measured monthly. Gross burn rate is total expenses, while net burn rate subtracts revenue to show the actual cash depletion rate.
Q: What is a good burn rate for a startup? A: There is no universal answer — it depends on your stage, funding, and growth goals. As a rule of thumb, most investors expect startups to maintain at least 12-18 months of runway after each funding round.
Q: What is the difference between gross and net burn rate? A: Gross burn rate is your total monthly spending. Net burn rate subtracts monthly revenue from expenses. If you earn \$20,000/month and spend \$50,000/month, your gross burn is \$50,000 and your net burn is \$30,000.
Q: How often should I recalculate runway? A: Monthly at minimum. Revenue and expenses fluctuate, and keeping an up-to-date runway figure helps you make timely decisions about hiring, spending, and fundraising.
Q: What happens when runway reaches zero? A: When cash reserves are fully depleted, a business cannot meet its financial obligations — payroll, rent, vendor payments. This typically leads to layoffs, emergency fundraising, or closure unless alternative funding is secured.
Q: Does this calculator account for variable expenses? A: This calculator assumes a constant monthly burn rate. For businesses with highly variable expenses, use your average monthly spending over the past 3-6 months for the most accurate estimate.
Q: Is my financial data stored anywhere? A: No. All calculations run entirely in your browser. Nothing is sent to any server or stored anywhere.
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