Burn rate and runway
How many months of cash are left, when revenue covers expenses, and what the cash line looks like month by month. Growth is compounded monthly, so the projection shows the shape of the plan rather than a straight-line guess.
| Month | Cash | Revenue | Expenses |
|---|---|---|---|
| 0 | $2.00M | $80.0k | $220.0k |
| 6 | $1.20M | $113.5k | $233.5k |
| 12 | $559.4k | $161.0k | $247.9k |
| 18 | $157.2k | $228.3k | $263.2k |
| 24 | $131.1k | $323.9k | $279.3k |
| 30 | $672.0k | $459.5k | $296.5k |
| 36 | $2.05M | $651.8k | $314.8k |
| 42 | $4.66M | $924.6k | $334.1k |
| 48 | $9.06M | $1.31M | $354.7k |
| 54 | $16.02M | $1.86M | $376.5k |
Cash is end-of-month; the month in which cash first goes negative is counted as the last month of runway.
cash / (expenses − revenue) · Only exact when both are flat.
expenses − revenue · Gross burn is expenses alone.
R_m = R_0(1+g)^m · Growth is applied monthly in the projection.
A clear path from inputs to results.
Runway is the number of months before the bank account is empty, not the number of months in the plan. Growth changes the shape: a company with rising revenue and flat costs has a runway that is longer than cash divided by today’s burn.
How to use
- Enter cash, monthly revenue and monthly expenses.
- Set the monthly growth for each.
- Read the runway, the date and the month revenue covers expenses.
The formula
Reference: Monthly cash roll-forward with compounding revenue and expenses (Brigham & Ehrhardt, Financial Management, cash budgeting).
Worked example
$2M cash, $80k revenue, $220k spend
- 6% monthly revenue growth, 1% expense growth.
- 1
Net burn today is $140k. Revenue compounds to about $135k in month 9 while expenses reach $240k, so the gap narrows slowly.
Runway about 16 months, break-even beyond the 60-month window unless growth improves.
Interpreting the result
The break-even month is more useful than the runway: it tells you whether the plan works without another round, which is the question a board actually asks.
Assumptions & limitations
- Cash is end-of-month.
- Growth compounds monthly.
- No financing, receivables timing or tax payments.
- Expenses include everything that leaves the bank.
Frequently asked questions
Gross or net burn?
Net burn is expenses minus revenue; gross burn is expenses alone. Runway uses net.
What is a good burn multiple?
Net burn divided by net new ARR; below 1.5 is efficient, above 2 is expensive growth.
Why does my runway look longer than expected?
Because revenue growth is compounding while expenses are not; check whether that growth is realistic.
Should I include a raise?
Model the current plan first. A raise changes the cash line, not the break-even month.
Methodology last reviewed 2026-10-22. Results are informational and not financial or engineering advice — see our disclaimer.