Finding customers and growing
Burn rate and runway
Burn rate is how much more cash your company spends than it brings in each month, and runway is how many months your cash lasts at that pace.
Also called burn
Looking this up for a class, a job, or something you want to build? If it is the last one, nommi reads your idea before you spend months on it.
Runway is the cash you have divided by your monthly burn. Both change whenever spending or revenue changes, so recalculate them rather than remember them.
Gross burn is everything you spend in a month. Net burn is that spend minus the cash that comes in, and it is what most people mean by burn rate. Runway is shorter than it looks, because raising a round can take months, so the real deadline to start is well before the cash ends. A high burn is not wrong on its own. What matters is what it buys.
What recent High Alpha data says
In High Alpha's 2025 survey, the median SaaS company under 1 million US dollars of ARR (yearly recurring revenue) burned 50 thousand US dollars a month, and the median between 1 million and 5 million burned 175 thousand.
- Median monthly cash burn, under 1 million and 1 million to 5 million US dollars of ARR: 50 thousand and 175 thousand US dollars.
Source: High Alpha, 2025 SaaS Benchmarks Report. More than 800 SaaS companies surveyed, 69% in the US, not all startups. As of 5 November 2026.
When this shows up
Example, not a real founder: a founder checks the bank balance, sees most of a year left and plans to raise later. Counting the months a round usually takes, the time to start talking to investors is already close.
What to do next
Divide the cash you hold today by last month's net burn. Then subtract the months you expect a raise to take, and put that date in your calendar.