Cash Runway
Runway is how many months your company can continue operating at current burn rate before running out of cash. It's the ticking clock that determines when you need to raise, become profitable, or shut down.
Cash in bank: $1.2M. Net burn: $100K/month. Runway = $1.2M / $100K = 12 months.
Fundraising takes 3-6 months. If your runway drops below 6 months, you're in the danger zone, forced to raise on bad terms or make drastic cuts. Smart founders start raising with 9-12 months of runway.
Danger zone
Start fundraising
Comfortable
Extended (post-2022)
Start when you have 9-12 months of runway. Fundraising takes 3-6 months on average, and you want buffer for negotiations and delays. Never enter a raise with < 6 months runway.
Reduce burn (cut costs), accelerate revenue (sales push), improve collections (reduce AR days), defer payments (negotiate with vendors), or explore debt financing.
If current growth trajectory will get you to profitability before cash runs out, you're default alive. If not, you're default dead and dependent on raising more money. Know which you are.
We build real-time dashboards that track Runway and every other metric investors care about. Updated daily. Investor-ready.
