Free Burn Rate Calculator
Calculate your startup's monthly burn rate and runway to understand how quickly you are spending cash and how long your funds will last.
Net Burn Rate (monthly)
$50,000.00
Net Burn Rate (monthly) vs Monthly Expenses
How to Calculate Burn Rate and Runway
Formula
Gross Burn = Monthly Expenses Net Burn = Monthly Expenses - Monthly Revenue Runway = Cash Balance / Net Burn
Burn rate is how fast a startup spends its cash reserves. Gross burn counts all spending. Net burn subtracts revenue, giving the actual cash outflow. Runway is the number of months until the cash runs out at the current net burn rate. Startups typically aim to maintain at least 12-18 months of runway to give themselves time to reach profitability or raise the next round.
Example Calculation
A startup has $500,000 in the bank, spends $80,000/month, and earns $30,000/month in revenue.
- 01Gross Burn = $80,000/month
- 02Net Burn = $80,000 - $30,000 = $50,000/month
- 03Runway = $500,000 / $50,000 = 10.0 months
Frequently Asked Questions
Learn More
How to Calculate Profit Margin
Learn how to calculate gross, operating, and net profit margins step by step. Understand what healthy margins look like across industries and how to improve yours.