Business Runway Calculator
Runway Calculator divides available cash by monthly burn to estimate how many months remain if burn stays constant and no new financing or major change occurs. Runway is a scenario, not a forecast: revenue, hiring, collections, debt, taxes, one-time purchases, and financing can change it quickly. A single number should be accompanied by assumptions and downside cases.
Runs locally — files stay on your deviceWhat is the runway for 300,000 cash and 25,000 monthly burn?
Estimated runway is 12 months.
Formula: 300,000 ÷ 25,000 = 12
Runway converts cash reserve into time
Runway in months = available cash ÷ monthly net burn. The formula requires positive burn. If cash is stable or growing, this finite-runway model is not appropriate.
How it works
Enter unrestricted cash available for operations and a forward-looking monthly burn estimate. Compare base, downside, and hiring or revenue scenarios rather than relying on one historical average.
Key concepts
Operational runway ends before zero in practice
Payroll, covenants, minimum cash, and financing lead time can require action well before cash is exhausted.
Burn should be forward-looking
Historical burn may not include planned hires, contracts, taxes, or changing revenue.
When to use it
- Translate a burn scenario into months.
- Check planning sensitivity to spending changes.
- Communicate a simplified cash horizon with assumptions.
When not to use it
- Do not count restricted or unavailable cash.
- Do not assume burn remains constant during growth or contraction.
- Do not wait until theoretical zero cash to plan financing or changes.
Worked examples
One-year runway
- Input
300,000 cash; 25,000 burn- Expected output
12 months
Cash covers twelve identical burn periods.
Hiring scenario
- Input
Burn rises from 25,000 to 40,000- Expected output
Runway falls from 12 to 7.5 months
The denominator materially changes the horizon.
Zero burn
- Input
Cash stable; burn 0- Expected output
No finite result
Division by zero does not describe a finite depletion period.
Common mistakes
Using bank balance as fully available cash
Restricted funds or upcoming liabilities may not be usable. Correction: Use a documented available-cash definition.
Assuming constant burn
Plans and revenue change month to month. Correction: Model multiple phases or scenarios.
Treating runway end as action date
Financing and restructuring require lead time. Correction: Set earlier decision thresholds.
Best practices
- Use unrestricted cash and forward burn.
- Model base and downside scenarios.
- Track minimum-cash and financing lead-time thresholds.
Related operations and differences
Burn Rate Calculator
Choose Burn Rate Calculator when you need to estimate average monthly cash burn.; use Business Runway Calculator specifically for runway.
Customer Churn Calculator
Choose Customer Churn Calculator when you need to calculate the percentage of customers lost.; use Business Runway Calculator specifically for runway.
Gross Profit Calculator
Choose Gross Profit Calculator when you need to calculate gross profit and gross margin.; use Business Runway Calculator specifically for runway.
Markup Calculator
Choose Markup Calculator when you need to calculate markup from cost and selling price.; use Business Runway Calculator specifically for runway.
MRR to ARR Calculator
Choose MRR to ARR Calculator when you need to annualize monthly recurring revenue.; use Business Runway Calculator specifically for runway.
Profit Margin Calculator
Choose Profit Margin Calculator when you need to calculate profit as a percentage of revenue.; use Business Runway Calculator specifically for runway.
Limitations and privacy
- The result is a simplified management estimate, not accounting, tax, legal, or investment advice.
- The formula assumes constant positive burn and no other cash-flow changes.
- It does not model insolvency law, covenants, financing probability, or timing.
Business figures are calculated locally in this browser and are not uploaded.
Frequently asked questions
What is runway formula?
Available cash ÷ monthly burn.
What if burn is zero?
The simple model has no finite depletion time.
Should restricted cash be included?
No, not if it cannot fund ordinary operations.
Why might actual runway be shorter?
Burn can rise, revenue can fall, liabilities can arrive, and action may be required above zero cash.