Burn Rate Calculator for Series-a First Time Founder

Understanding Startup Burn Rate

Burn rate measures how quickly your startup spends cash each month. Knowing your burn rate and runway helps you plan fundraising timing and make better decisions about hiring, marketing spend, and product development.

Calculating Your Runway

Your runway is your remaining cash divided by your monthly burn rate. Our calculator helps you model different spending scenarios and understand exactly when you need to raise your next round.

How to Use the Burn Rate Calculator

1. Enter your current cash balance and monthly expenses
2. Adjust spending categories to model different scenarios
3. See your projected runway in months
4. Plan your fundraising timeline based on runway projections

When to Use This Calculator

• You just closed a round and want to set a monthly budget that preserves at least 18 months of runway
• You are deciding whether to make a new hire and need to see the runway impact
• Your board is asking for a monthly financial update and you want clean numbers
• You are approaching fundraising and need to time your outreach based on remaining runway

Key Metrics and Formulas

Gross burn rate is your total monthly expenses before any revenue. Net burn rate subtracts monthly recurring revenue from gross burn: Net Burn = Gross Burn - MRR. Runway equals cash on hand divided by net burn rate. The burn multiple measures efficiency: Burn Multiple = Net Burn / Net New ARR. A burn multiple below 1.5x is excellent, 1.5x-2.5x is good, and above 2.5x signals inefficiency. Our calculator tracks all three metrics and projects your cash balance month by month.

Common Mistakes to Avoid

• Using gross burn when you should use net burn: If you have revenue, net burn gives a more accurate runway picture
• Not accounting for lumpy expenses: Annual payments, tax bills, and equipment purchases can spike your monthly burn
• Starting fundraising with less than 6 months of runway: Most rounds take 3-6 months to close, so start early
• Cutting costs too aggressively and stalling growth: Investors want capital-efficient growth, not zero spending