Startup Runway Calculator

Startup runway measures how many months a company can continue operating before running out of cash. It is one of the most critical metrics any founder must monitor.

The core formulas:

Monthly Burn Rate = Total Monthly Expenses − Monthly Revenue

Runway (months) = Current Cash Balance / Monthly Burn Rate

Zero Date = Today + Runway in Months

Months to Profitability = (Fixed Costs / Gross Margin per Unit) / Monthly New Customers

What each variable means:

• Burn Rate — net cash spent per month (gross burn = all expenses; net burn = expenses minus revenue)
• Cash Balance — total liquid cash and equivalents available right now
• Runway — the answer to “how long until we need more funding or revenue?”
• Zero Date — the specific calendar date when cash runs out if nothing changes

Worked example: A SaaS startup has $420,000 in the bank. Monthly expenses: $85,000 (salaries, servers, marketing). Monthly recurring revenue: $22,000.

Net burn = $85,000 − $22,000 = $63,000/month Runway = $420,000 / $63,000 = 6.67 months ≈ 6.5 months of runway Zero date: approximately 6–7 months from today

Rule of thumb benchmarks:

• Safe runway: 18+ months
• Healthy runway: 12–18 months
• Danger zone: under 6 months
• Critical: under 3 months (start fundraising immediately)

Investors expect founders to raise their next round when 6 months of runway remain — fundraising typically takes 3–6 months, so you need a buffer. Reduce burn by deferring non-essential hires and negotiating vendor contracts before you hit the danger zone.