Home›Metrics & product

Burn rate and runway: how long your cash lasts

Work out how much cash your startup burns each month, when the money runs out and whether it is “default alive”, that is, whether it reaches break-even before cash hits zero. See when to start the next round and how much faster growth or expense cuts extend your runway.

Educational simulation. Not investment advice. Results are estimates based on the data you enter and do not replace advice from a qualified professional.

Reviewed on Oct 31, 2026

The startup

Example monthly figures for a post-seed SaaS startup.

Costs that scale with revenue: hosting, sales taxes, payment fees and support (the inverse of gross margin). A funding round usually takes 4 to 9 months from the first conversation to money in the bank.

Your inputs stay only on this browser and are not sent anywhere. Untick to delete them.

—Runway: months until cash runs out
—

Projected cash, month by month

Cash balance with the revenue and expense growth you entered. The shaded band marks the window in which fundraising must start.

Tap the chart to see the values.

Revenue and expenses: when they cross

Break-even is the month in which revenue, after variable costs, pays for expenses.

Tap the chart to see the values.

Runway by revenue growth and expense cuts

Months until cash runs out. “Always” means the startup reaches break-even first (default alive).

Monthly projection

The summary lists your inputs, results, formulas, assumptions and sources. The full report also includes the charts and interpretations, in color. In the print dialog, choose Save as PDF.

Method, assumptions and sources

Formulas

Net burn = expenses + variable costs − revenue
Revenue(m) = revenue × (1 + growth)^(m − 1); expenses(m) = expenses × (1 + expense growth)^(m − 1)
Cash(m) = cash(m − 1) − burn(m); runway = months until cash turns negative (up to 60)
Start of fundraising = month cash runs out − months to close the round

Assumptions and limits

  • Educational simulation. Revenue and expenses grow at the monthly rates entered, with no seasonality, late payments or step-ups in hiring.
  • Default alive (Paul Graham, 2015): the startup reaches profitability with the cash it has, without new funding. Projection capped at 60 months.
  • The projection assumes constant growth. In practice revenue and expenses vary from month to month; review your runway every month with actual cash.

Official sources and references

Frequently asked questions

What is burn rate?

How much cash a startup uses each month. Net burn subtracts the revenue that comes in; gross burn counts only expenses. In this calculator, net burn also includes the variable costs that grow with revenue.

How do I calculate runway?

Simple runway is cash on hand divided by monthly net burn. This calculator goes further: it projects revenue and expenses with the growth rates you enter and finds the month when cash would turn negative, up to 60 months.

How do I read the default example?

With $1.5 million in cash, $50,000 of revenue growing 7% a month and $160,000 of expenses, the startup burns $120,000 in the first month. Cash turns negative in month 14 (13 months of runway), long before break-even in month 28, so it is default dead and should start fundraising by month 8.

What does default alive mean?

Paul Graham’s term: a startup is default alive if it reaches profitability with the cash it has, keeping its growth and expenses. If not, it is default dead and depends on raising money or changing the plan.

What goes into “costs that scale with revenue”?

Costs that rise with sales: hosting, sales taxes included in revenue, payment processing fees, commissions and support. It is the inverse of gross margin: with an 80% gross margin, enter 20%. Fixed costs such as salaries and rent go in monthly expenses.

When should I start fundraising?

Six to nine months before cash runs out, because a round usually takes 4 to 9 months to close. Investors typically expect 18 to 24 months of runway after each round, so plan the next raise as soon as one closes.

What are the limits of this projection?

It assumes constant growth in revenue and expenses, with no seasonality, late payments or step-ups in hiring. Update it every month with your actual cash, and talk to your accountant, board or experienced advisors before major fundraising or layoff decisions.

Related calculators

See all in Metrics & product ›

Burn rate and runway: how long a startup’s cash lasts

Burn rate is how much cash a startup uses each month. Runway is how many months that cash will last at the current pace. They are the two numbers that matter most for a company that is not yet profitable, because they show how much time is left to reach break-even or raise the next round.

The formulas

  • Gross burn = total monthly expenses.
  • Net burn = expenses + variable costs − revenue.
  • Simple runway = cash ÷ net burn.

In the calculator’s example, a startup with $1.5 million in the bank, $50,000 of monthly revenue and $160,000 of expenses burns about $120,000 a month, enough for roughly 12 months at today’s pace.

The example uses the calculator’s default values; replace them with your own.

Default alive or default dead

The terms come from Paul Graham of Y Combinator. A startup is default alive if, keeping its expenses and revenue growth, it reaches profitability before the cash runs out. Otherwise it is default dead: it depends on new funding or a change of plan. Knowing which one you are changes decisions: a default-dead company has to raise early or cut costs now.

When to start fundraising

A round usually takes 4 to 9 months from the first meetings to money in the bank. The calculator shows the last month to start fundraising in time. Raising with little runway weakens your position, because investors sense the urgency.

How to extend runway

  • cut expenses that do not help you grow or prove the model;
  • raise gross margin through pricing or lower cost to serve;
  • bring revenue forward with annual plans paid upfront;
  • delay hires until revenue justifies them.

The calculator’s heat map shows runway for different combinations of revenue growth and expense cuts.