Cash runway calculator

How this calculation works

Each month, revenue grows at your stated monthly rate and operating costs grow at theirs. Net burn is costs minus revenue. Cash falls by net burn, and the calculation runs forward up to 48 months, stopping when the balance reaches zero. Runway is the first month where the closing balance is negative.

Compounding both sides separately matters. A company growing revenue 6% a month while costs grow 2% reaches breakeven; the same company letting costs grow 6% never does, and a single-rate burn calculation cannot show the difference.

Reading the result

Under 6 months is an emergency: you are raising from a position of weakness and every term will reflect it. 6 to 12 months means starting a raise now, since a round takes three to six months from first meeting to cash in the bank. 12 to 18 months is the standard target after a round — enough to reach a milestone and then raise against it. Over 24 months occasionally signals under-investment rather than prudence, depending on the market.

The useful discipline is to work backwards from the milestone rather than forwards from the cash. Identify the metric that makes the next round raisable, cost the path to it, add the months a raise takes, and add a genuine buffer. That number is the raise. This is exactly what a fundraising model formalises.

What this tool deliberately ignores

Smooth monthly growth is a fiction. Real cash flow has annual insurance renewals, tax payments, bonus months, an inventory build ahead of a launch, and customers who pay 45 days late. Any one of those can move the cash-out month by a quarter.

Receivable and payable timing is the most common omission. A profitable month on the profit and loss is not a cash-positive month if the invoice settles in 60 days. A proper three-statement model shows cash as a result of those movements rather than as a straight line.