How the runway calculator works
Runway is how long a company can operate before its cash runs out. Gross burn is total monthly spending; net burn is spending minus revenue, the amount by which cash actually falls each month.
Runway (months) = Cash on hand ÷ Net burn
With a growth rate, the calculator steps month by month, raising revenue each month and subtracting that month's net burn, so growing revenue stretches the runway. If revenue overtakes expenses before cash runs out, the company reaches default alive. Many investors advise starting to raise money with at least 6 to 9 months of runway left, since rounds often take three to six months to close.
Worked example
A startup with $500,000 in the bank, $20,000 of monthly revenue and $60,000 of expenses burns $40,000 net per month, giving 12.5 months of runway. If revenue grows 5% a month, net burn shrinks every month and the runway stretches to around 17 months.
Frequently asked questions
What is the difference between gross and net burn?
Gross burn is total monthly spending. Net burn subtracts revenue and shows how fast cash is actually falling.
How much runway should a startup have?
After raising, 18 to 24 months is a common target, enough to hit milestones and raise again.
Does runway include money owed to us?
Count only cash in the bank. Receivables can be added once collected.
What does default alive mean?
A phrase popularised by Paul Graham: a startup is default alive if its current growth would make it profitable before money runs out.
Updated October 2026. Results are estimates for education, not financial or medical advice. All math runs in your browser; nothing you type is sent anywhere.