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Runway and burn calculator

How many months the money in the bank lasts, when it runs out, and when you should start raising the next round.

Reviewed 2 min read Sources

Runway is the number of months the company can operate before its cash runs out at the current rate of spending. This calculator takes cash in the bank, monthly revenue and expenses, and optional monthly growth rates, then shows the month the cash runs out, when revenue overtakes costs (if it does), and when to start raising so that the round closes with time to spare. It runs in your browser; nothing is sent anywhere.

Today
Everything that leaves the bank: payroll with taxes and benefits, rent, software, contractors.
Growth and fundraising
From first meetings to money in the bank, with a margin.
Net burn now$100,000/moexpenses − revenue
Runway17 monthscash runs out in month 18
Start raising bymonth 11allowing 6 months to close
Cash balance by month−$1M−$500k$0$500k$1M$1.5M$2M06121824month
Cash at the end of each month; it goes negative in month 18.

Turn on JavaScript to use your own numbers; the example is explained below.

The default example

A company with $1.8 million in the bank, $20,000 of monthly revenue growing 8% a month, and $120,000 of monthly expenses growing 2% a month:

  • Net burn today is $100,000 a month. Divided into the cash, that looks like 18 months; with no growth at all the cash would run out in month 19.
  • With the growth rates, costs rise as well as revenue. Cash runs out in month 18; revenue would overtake expenses only in month 33, well after the money is gone.
  • Allowing six months to raise the next round, fundraising should start by about month 11.

The point of the exercise is the gap between "when do we run out" and "when do we need to start": founders who start raising with only a few months left negotiate from weakness. If the break-even month is close to the zero-cash month, a modest cut in burn can change the company's options entirely; try lowering expenses in the calculator.

Definitions

Gross burn
Total cash spent in a month.
Net burn
Gross burn minus cash coming in from revenue. The figure that drains the bank account.
Runway
Cash ÷ net burn, if nothing changes; this calculator instead steps month by month so growth in revenue and costs is included.
Default alive / default dead
Whether, on current trends and without new money, revenue overtakes costs before the cash runs out. A phrase popularized by Paul Graham; the calculator's break-even month answers the same question.

Keep in mind

  • Use cash figures, not accounting profit: annual contracts paid upfront, deferred salaries and tax credits all change the timing.
  • Growth rates compound. A 10%-a-month revenue growth assumption over two years is a tripling every year; be honest about whether it is a forecast or a hope.
  • Big one-off items (a hardware order, a lawyer's bill for the round) are not in a monthly model; leave a buffer.

To size the next round from milestones and a hiring plan, use how much to raise.

Sources

  1. Default Alive or Default Dead?, Paul Graham. Cited for the term; not reproduced.

Read next

Calculator How much to raise Size a round from the plan, not from a headline: what it costs to reach the milestones that justify the next round, plus a buffer for delays. Stage Seed The round that turns early evidence into a repeatable business. Seed money usually funds a small team for long enough to reach Series A milestones. Process guide Building your investor list Who invests at each stage, how to judge fit before the first meeting, where to find public information, and how to track and sequence the conversations.