Calculate Clean Runway Before You Tell the Board
Calculate gross burn, net burn, and decision runway from a simple startup cash picture.
You have $2.1 million in cash. Monthly operating expenses are $310,000. Monthly collected revenue is $95,000. There is a $120,000 annual insurance payment due in two months, and a planned hire would add $18,000 monthly starting next month. Calculate runway in three passes: current net burn, normalized net burn including near-certain changes, then decision runway relative to the next proof point and raise duration. Common trap: quoting runway from booked revenue or ignoring one-off cash events creates a cleaner number than the company actually has. Step 1 Current gross burn = $310,000 per month. Current net burn = $310,000 -…
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