Runway

Cash runway calculator

Cash runway is the time until available cash reaches zero under an explicit burn and income assumption. If costs are changing, a fixed cash ÷ burn estimate can be misleading.

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# Cash runway
starting_cash = 30000 in usd
monthly_burn = 2800 in usd
monthly_income = 600 in usd
net_burn = monthly_burn - monthly_income
simple_runway_months = starting_cash / net_burn
three_month_cost = net_burn * 3
cash_after_three_months = starting_cash - three_month_cost

Inputs

What the model needs

Starting cash
The reserve dedicated to the modeled period.
Monthly burn
Recurring cash outflow before income offsets.
Monthly income
Reliable recurring inflow during the runway.
Burn change
Expected monthly growth or reduction in net burn.

Method

Formulas stay visible

net_burn = monthly_burn - monthly_incomesimple_runway = starting_cash / net_burnchanging-burn runway is found by projecting each month until balance ≤ 0

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Worked example

A transition funded by $30,000

  • $30,000 starting cash
  • $2,800 monthly costs
  • $600 recurring income
  • 3% modeled burn growth
ResultThe flat-burn baseline is about 13.6 months; growing costs shorten the projected runway.

The useful question is not only the depletion month. It is when to cut costs, replace income, or stop treating the current plan as safe.

01

Stress-test it

  • Test zero income and delayed income separately.
  • Add irregular known expenses in the month they occur.
  • Compare flat burn with a realistic upward or downward cost trend.
02

Use it when

  • Planning a sabbatical or job transition
  • Monitoring a bootstrapped business
  • Deciding how much cost reduction buys meaningful time
03

Know the boundary

  • A monthly average can hide timing problems inside a month.
  • Do not count uncertain receivables as cash until you intentionally model their risk.
  • Runway is a planning horizon, not a promise that income or costs stay stable.

Questions

Is runway cash divided by monthly expenses?

Only when there is no income and costs are flat. With recurring income, use net burn. With changing costs or irregular cash events, project the balance over time.

What if income is greater than burn?

The simple depletion case no longer applies because the modeled balance is not shrinking. Stress-test whether the income is durable instead.

How often should runway be updated?

Update whenever cash, recurring income, or the cost structure changes materially. During a constrained period, monthly review is often more useful than an annual budget.

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