Formula
runway (months) = cash on hand / net monthly burn
Runway
Also known as Cash runway
Runway is the number of months a company can keep operating before it runs out of cash, at its current rate of spending.
Worked example
€400,000 in the bank with €35,000 of net monthly burn is 11.4 months of runway.
Benchmark
Most investors expect 18 to 24 months after a round. Below 6 months you are raising from a weak position.
All startup finance benchmarks →Runway is the most consequential number in an early company, because it converts every other decision into a deadline. A hire, a tool, a marketing budget: each one shortens it, and the question is always whether the thing bought moves the company further than the months it cost.
It is computed from net burn, not gross spending. A company spending €52,000 and collecting €28,000 burns €24,000, and its runway reflects the €24,000. Companies that quote runway off gross spend understate it, sometimes badly.
The figure is only as current as its inputs. A runway calculated from a spreadsheet last updated six weeks ago is not a runway, it is a memory.
Common questions
How do you calculate runway?
Divide the cash you have by your net monthly burn, which is spending minus incoming cash. Use a three-month average for burn rather than one month's figure, since a single month can be flattered by an annual prepayment or distorted by a one-off cost.
How much runway should a startup have?
Investors typically expect a round to buy 18 to 24 months. Operationally, 12 months is the line: below it, fundraising or cutting costs becomes your actual job, because a raise takes roughly six months and you never want to negotiate from your last few.
Is runway the same as burn rate?
No, they are two halves of one calculation. Burn rate is how much cash you lose per month; runway is how many months you can sustain it. Burn is the speed, runway is the distance left, and cash in the bank connects them.
Keep this number live
Plainhub computes runway from money you record in plain words, so it is current when you need it rather than the night before a board meeting.
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