The startup runway calculator above answers the only question that matters when cash is finite: how long until it is gone. It does it three ways — assuming burn stays flat, assuming burn grows at the rate you set, and assuming you make a specific monthly cost reduction — so you can see the gap between the comfortable version of the number and the realistic one.
Arb Digital works with founders and owner-managers who need to decide how much of a limited cash balance can go into growth. Runway is the constraint that sits behind that decision, and a runway figure built on flat burn assumptions is the most common reason a plan that looked funded in January is short by September.
What This Startup Runway Calculator Does
Enter your cash balance and current net burn and the tool returns runway in months, plus the calendar month the cash is projected to run out. Because most companies do not hold burn constant, a growth field compounds burn month by month and reports the shorter, more realistic runway alongside the flat-burn figure so you can see how much optimism the simple division was hiding.
The cost-cut field answers the follow-up question. Enter a monthly saving you could realistically make and the calculator recomputes runway with that saving applied from month one, then shows the extra months it buys. That last number is what turns an abstract cost-cutting discussion into a decision with a measurable payoff.
How to Use It
- Enter cash in bank. Only cash you can spend. Money held as a security deposit, a customer escrow, or a facility you have not drawn is not runway.
- Enter net burn. Cash out minus cash in for a typical month. If you are not sure of the figure, work it out with the burn rate calculator first.
- Set monthly burn growth. Zero means burn is held flat. A planned hire, a rising cloud bill, or an increasing ad budget all push this above zero. Use a negative number if you are actively reducing spend.
- Enter a monthly cost cut. A saving you could actually make — a paused ad channel, a cancelled tool stack, a deferred hire.
- Set the start month and read the projected out-of-cash date alongside the month figures.
The Formula / How It's Calculated
Flat-burn runway is the version everyone knows: Runway = Cash ÷ Monthly Net Burn. With $900,000 in the bank and $75,000 a month of net burn, that is 12.0 months exactly.
Growth-adjusted runway cannot be done with a single division, because each month's burn depends on the last. The calculator steps forward month by month, multiplying burn by (1 + growth rate) each time and subtracting it from the remaining balance until the balance hits zero, then interpolates the final partial month. At 3% monthly growth, the same $900,000 and $75,000 gives roughly 10.4 months rather than 12 — a month and a half of runway that the simple formula quietly invented.
The cost-cut scenario runs the same month-by-month loop with burn reduced by your saving from month one, growing at the same rate thereafter. The extra months figure is the difference between that result and the growth-adjusted baseline.
Why Flat-Burn Runway Is Almost Always Wrong
Dividing cash by current burn assumes the business next quarter costs exactly what it costs today. Very few do. Salary increases take effect on anniversaries. Cloud and data costs scale with usage. Insurance renews higher. A hire agreed in March starts in May and shows up in payroll from then on. Each of these is small; compounded across a year they are not.
The compounding is the part people underestimate. Three percent a month sounds trivial — it is roughly 43% higher burn twelve months later, and it shortens runway disproportionately because the largest monthly burns land at the end, when there is least cash to absorb them. This is why runway forecasts tend to be revised downward repeatedly rather than once: each revision only corrects for growth already observed, not the growth still ahead.
The Fundraising Timeline Hidden Inside Your Runway
Runway is not the same as time available. Raising capital or securing a loan takes months of preparation, conversations, diligence, and legal work before money lands, and that process is easier to run from a position of strength than from a position of urgency. Practically, the decision point sits well before the out-of-cash date rather than at it.
The useful reframe is to treat runway as two segments: the period in which you can operate and plan normally, and the period in which the dominant activity is securing more cash. Whatever length you assign to the second segment, subtract it from your total runway to get the number of months you genuinely have to execute the current plan. The out-of-cash date this calculator produces is the boundary, not the deadline. The U.S. Small Business Administration's overview of SBA loan programmes sets out what the debt route typically involves in terms of documentation and timing.
What a Cost Cut Actually Buys
The relationship between cost cuts and runway is not linear, and that surprises people in both directions. A 10% reduction in burn does not add 10% to runway — it adds more, because runway is cash divided by burn, and reducing the denominator has a proportionally larger effect the closer burn gets to zero. Cutting burn from $75,000 to $63,000 on a $900,000 balance moves flat runway from 12.0 months to 14.3, a gain of nearly 20% from a 16% cut.
Working in the other direction, the same maths means small increases in burn are more expensive in runway terms than they look on a budget line. Adding a $12,000 monthly commitment to a $75,000 burn removes almost two months of runway at that cash balance. Running the number before committing, rather than after, is the entire value of having the calculation to hand.
Runway Is a Cash Measure, Not a Profit Measure
A company can be profitable on paper and still run out of cash, because profit records revenue when it is earned and runway tracks money when it arrives. A business with 60-day customer terms and 30-day supplier terms funds a month of working capital on every sale it makes, and the faster it grows the more cash that gap consumes. Growth can shorten runway even while margins improve.
This is why the balance-sheet view matters alongside the cash-flow view. The working capital calculator shows how much cash your receivables, inventory, and payables cycle is tying up, and the inventory turnover calculator covers the stock side specifically for product businesses, where a warehouse full of goods is runway that has already been spent.
Stress-Testing the Number Before You Rely on It
A single runway figure is a point estimate that depends on assumptions you control. It is worth running the calculator three times: once with your plan as written, once with burn growth a couple of points higher and collections slower than planned, and once with the cost reductions you would make if the first scenario materialised. The spread between those three results is the real answer, and it is usually wider than a single number suggests. The U.S. Bureau of Labor Statistics publishes establishment survival rates by year and industry through its Business Employment Dynamics programme, which is a useful reference point for how long businesses in your sector typically continue trading.
Pay particular attention to the cash-in side. Runway models are usually built on a revenue forecast, and the revenue forecast calculator makes that assumption explicit rather than leaving it buried. If forecast revenue slips by a quarter, net burn rises by the shortfall, and the runway you planned around contracts accordingly. Modelling a delayed rather than reduced forecast is a good discipline, because in practice revenue more often arrives late than never.
Arb Digital builds acquisition programmes sized to the cash a business actually has, with clear reporting on what each channel returns and how quickly.
Talk to Arb Digital Browse Free ToolsCommon Mistakes to Avoid
- Using flat burn for a growing company — compounding burn growth typically removes one to two months from a twelve-month runway.
- Counting an undrawn credit facility as cash — it is a financing option with conditions, not money in the account.
- Treating the out-of-cash date as the deadline — the practical decision point sits earlier, because raising or borrowing takes months.
- Forgetting the upfront cost of cutting costs — notice periods, contract exit fees, and severance are cash outflows before any saving begins.
- Modelling one scenario only — a plan case, a downside case, and a response case together tell you far more than any single figure.
Related Free Tools From Arb Digital
Work out the burn number that feeds this tool with the burn rate calculator, find the revenue level that ends the burn with the break-even calculator, check what new hires do to burn with the employee cost calculator, and see how a raise affects ownership with the equity dilution calculator. Browse the full free online tools hub for more.
Frequently Asked Questions
Divide spendable cash by monthly net burn for the simple version. For a more realistic figure, step forward month by month with burn increasing at your expected growth rate, subtracting each month's burn from the remaining balance until it reaches zero.
Net burn, because cash collected from customers offsets what you spend. Using gross burn understates runway for any business with revenue, sometimes dramatically.
Because burn rarely stays flat. Salary reviews, usage-based cloud costs, renewals, and planned hires all push monthly burn up, and that increase compounds. This calculator shows the flat and growth-adjusted figures side by side so the difference is visible.
There is no universal figure, and any number quoted as a rule ignores differences in industry, funding environment, and how long the business takes to reach cash-flow break-even. The more useful question is how many months you need to reach a specific milestone, plus the time it takes to secure further funding.
No — it extends it more than proportionally. Runway is cash divided by burn, so reducing burn by 16% can add nearly 20% to runway. The same maths means new recurring commitments cost more runway than they appear to on a budget line.
Yes. Profit is recorded when revenue is earned, but runway depends on when cash arrives. A business selling on 60-day terms while paying suppliers in 30 funds a working-capital gap on every sale, and growth widens that gap.
Yes, if they leave the bank account within the period. Runway is a pure cash calculation, so any outflow reduces it regardless of how it is classified on the profit-and-loss statement.
Figures produced by this tool are planning estimates only and do not constitute financial, tax, or accounting advice. Actual runway depends on collection timing, contract terms, and conditions that vary by business and jurisdiction.
