Easily track how much cash your startup spends each month and how long your current funds will last. This free burn rate calculator helps you plan your runway and stay ahead of funding needs.
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A burn rate calculator helps startups understand how quickly they are spending money each month. It calculates the average monthly cash outflow and shows how many months of runway are left before the funds run out.
This tool is especially useful for early-stage companies managing tight budgets and planning funding rounds. Knowing your burn rate helps you avoid running out of cash and make smarter financial decisions.
A burn rate calculator measures how quickly a business uses its available cash. It calculates the monthly cash outflow and divides the total cash reserves by that number to determine the company’s financial runway. This tool helps startups and investors assess how long operations can continue without new funding.
Our free online burn rate calculator uses your total cash reserves and your average monthly expenses to estimate:
You only need two inputs:
The formulas used:
Here’s a detailed example of how a burn rate calculator works:
If a company has $500,000 in the bank and spends $62,500 each month on salaries, rent, and tools, the burn rate calculator divides $500,000 by $62,500. The result is 8, meaning the company has 8 months of runway.
Burn rate tells startups how fast they are using their available funds each month. It quantifies operational efficiency and provides a clear view of how long the company can continue before running out of money.
A high burn rate signals that a startup is spending heavily and may face cash flow issues soon. By contrast, a low burn rate suggests better financial stability and a longer survival window without new funding.
The runway is the number of months a startup can operate before exhausting its capital. Burn rate directly affects this timeline. Lowering the burn rate can extend the runway, giving the company more time to reach milestones or profitability.
Startups use burn rate to decide when to raise funds. Accurate burn tracking ensures that founders approach investors well before the company runs out of money, avoiding last-minute fundraising under pressure.
Monitoring burn rate forces founders to assess every expense. It helps identify unnecessary spending, prioritize essential activities, and align costs with growth goals, ensuring lean operations without sacrificing progress.
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