Burn Rate Calculator

Burn rate is one of the first financial metrics every startup founder learns, and it remains one of the most important throughout the life of a company. It measures how quickly your business consumes cash, and it directly determines how much time you have before you either need to raise more money, reach profitability, or shut down.

The simplest way to calculate burn rate is to look at your bank balance at two points in time. Subtract the ending balance from the starting balance to find the total cash consumed, then divide by the number of months in the period. This gives you your average monthly burn rate, smoothing out month-to-month fluctuations caused by irregular expenses like quarterly tax payments, annual software renewals, or one-time equipment purchases.

Once you know your monthly burn rate, you can calculate your remaining runway by dividing your current cash balance by the burn rate. If you have $700,000 remaining and your burn rate is $100,000 per month, you have roughly 7 months of runway. This number should guide every major financial decision, from when to start fundraising to whether you can afford a new hire.

Tracking burn rate over time reveals important operational trends. A rising burn rate may be intentional if you are investing in growth after a funding round, or it may signal spending discipline issues. A declining burn rate approaching zero means you are nearing profitability. The key is that changes in burn rate should be deliberate and aligned with your business strategy.

This calculator determines your monthly burn rate from historical cash data, shows the total amount burned over the measurement period, and calculates how many months of runway remain at the current pace.