Startup Burn Rate & Cash Runway Calculator
Calculate your startup's gross burn, net burn, and months of cash runway. Model expense-cut and revenue-growth scenarios to find your default-alive threshold.
Burn rate measures how fast a company spends its cash reserves. Gross burn is total monthly expenses; net burn is gross burn minus monthly revenue — the actual cash drain per month. Cash runway = current cash ÷ net monthly burn (per Y Combinator's "Default Alive" framework and Andreessen Horowitz's startup metrics canon).
For pre-revenue startups, gross burn equals net burn. For companies with revenue, net burn is the survival-critical figure. The "Default Alive" test: if your current revenue growth rate continues and expenses hold flat, will you reach break-even before cash runs out?
Worked example: $500,000 cash on hand. Monthly expenses $80,000. Monthly revenue $25,000. Net burn = $55,000/month. Runway = $500,000 ÷ $55,000 = 9.1 months. If expenses were cut 20% to $64,000, net burn drops to $39,000 and runway extends to 12.8 months.
How it's calculated
How to use this calculator
- Enter your current cash on hand (total available cash, not total assets).
- Enter monthly operating expenses (payroll, rent, software, marketing — all outflows).
- Enter monthly revenue (recognized revenue, not bookings or ARR).
- Results show gross burn, net burn, and months of runway. Use the scenario fields to model expense cuts or revenue growth.
Formula and assumptions
grossBurn = totalMonthlyExpenses netBurn = grossBurn - monthlyRevenue runway = currentCash / netBurn (months) runoutDate = today + runway months
- Constant burn
- Expenses and revenue held flat — model more growth in scenario fields
- Net burn floor
- If revenue > expenses (profitable), runway shows as Infinity
- Cash definition
- Liquid cash only — does not include AR, inventory, or credit lines
Worked example
Seed-stage SaaS: $600K cash, $70K expenses, $15K MRR
24-month cash projection at three burn rates
The table below shows remaining cash at end of each 6-month period for a startup with $600,000 cash at month 0, assuming three constant net burn rate scenarios. No revenue growth is modeled (conservative). Source: burn rate framework per a16z Startup Metrics.
| Month | $30K/mo burn | $55K/mo burn | $80K/mo burn |
|---|---|---|---|
| 0 | $600,000 | $600,000 | $600,000 |
| 6 | $420,000 | $270,000 | $120,000 |
| 12 | $240,000 | $60,000 ⚠ | $0 (out) |
| 18 | $60,000 | $0 (out) | — |
| 24 | $0 (out) | — | — |
At $55K/month net burn, you cross the 9-month fundraising-window alert at month 2. YC guidance: start your next raise when runway drops below 9 months.
Limitations
- Assumes constant burn and revenue — real businesses have seasonality and growth.
- Does not model debt service, capex spikes, or fundraising proceeds.
- Revenue is recognized revenue — not bookings, ARR/12 may differ from cash collected.
- Educational estimate only — consult a CFO or financial advisor for fundraising decisions.
Frequently asked questions
Net burn = monthly expenses − monthly revenue. Cash runway = cash ÷ net burn. A $600K-cash startup with $70K expenses and $15K MRR has net burn of $55K and 10.9 months of runway. YC's Default Alive framework recommends 18+ months of runway; start fundraising when below 9–12 months.
Recent updates
- May 2026Initial launch with gross burn, net burn, runway, and 24-month projection table.
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