What is the Runway Calculator?
The Runway Calculator estimates how many months your startup can continue operating before its cash balance reaches zero. It divides your current cash by your monthly net burn rate. Runway is the most closely watched metric by founders, investors, and lenders.
How does it work?
Enter your current cash balance from your bank and investment accounts. Enter your monthly net burn from the Burn Rate Calculator. The calculator divides cash by burn to produce the number of months until you run out. A runway of 12-18 months is considered healthy for most startups.
Formula
cash balance / monthly net burn
How the calculation works
How the calculation works
- 1Start with your current cash balance from bank and investment accounts.
- 2Enter your monthly net burn from the Burn Rate Calculator.
- 3Divide cash by monthly net burn.
- 4The result is the number of months you can operate before cash reaches zero.
Worked example
Worked Example
Peakfoundry, a fictional SaaS startup, has $750,000 in the bank and a monthly net burn of $63,000. The founding team wants to know how long it can operate before raising again.
- 1Divide cash by monthly burn: 750000 / 63000 = 11.9 months
- 2Peakfoundry can operate for about 11.9 months at the current pace
- 3If burn were cut to $50,000, runway would stretch to 750000 / 50000 = 15 months
Result
Peakfoundry has approximately 11.9 months of runway, placing it in the zone where the team should begin fundraising preparations.
Interpretation guide
How to read your result
Comfortable runway that lets you execute the plan without fundraising pressure.
Keep the plan going and start fundraising only when milestones make valuation defensible.
Standard runway for most startups, but fundraising will take 3-6 months of it.
Begin investor outreach and prepare diligence materials within the next few months.
Enough time to raise if you move deliberately, but little room for slippage.
Start the raise now, cut non-essential spend, and extend runway with every possible cost reduction.
Dangerously low runway that can force reactive decisions or an emergency raise at poor terms.
Reduce burn immediately, prioritize the fastest revenue wins, and consider bridge financing from existing investors.
Benchmarks
Runway benchmarks for startup planning
| Metric | Typical | Strong |
|---|---|---|
| Comfortable runway | 18-24 months | 24+ months |
| Standard planning zone | 12-18 months | 18+ months |
| Fundraising window | 6-12 months | 12+ months |
| Critical | Under 6 months | 6+ months |
Common mistakes
- - Using gross burn instead of net burn, overstating runway
- - Assuming burn rate stays constant when it often grows with headcount
- - Not maintaining a cash buffer for unexpected expenses or delayed revenue
Practical tips
Practical tips
Use net burn, not gross burn, or you will understate your true runway.
Use a 3-month average burn instead of a single month so irregular expenses do not skew the projection.
Plan for a 3-6 month fundraising process: a 12-month runway is really 6-9 months of execution time.
Recompute runway monthly at minimum, and weekly when burn is changing quickly or runway is under 9 months.
Model the impact of specific cuts, such as pausing hiring, to see exactly how much runway each decision buys.
Keep a small buffer in the runway estimate for delays in revenue, refunds, or unexpected vendor bills.
When should you use it?
- - Planning the timing of your next fundraising round
- - Evaluating whether cost-cutting measures provide enough runway extension
- - Monthly board reporting and investor updates
- - Deciding between growth at higher burn vs profitability at lower burn
Benefits
- - Prevents the most common cause of startup failure running out of cash
- - Provides a clear timeline for fundraising and cost management decisions
- - Helps align the team around cash conservation when runway is tight
Step-by-step example
Pull your current cash balance from your primary operating account. Calculate or enter your monthly net burn. The calculator divides cash by burn. If your burn changes month to month, use an average of the last 3 months for the most accurate projection.
Real-world example
A startup with $750,000 in the bank and a $63,000 monthly net burn has approximately 11.9 months of runway. If they reduce burn to $50,000, runway extends to 15 months, buying more time to reach profitability or close the next funding round.