You have cash.
You’re spending it.
You need to know how long it will last.
You need a cash runway roadmap.
Cash runway. Forecast. Time horizon. Your survival.
This guide shows you how.
Runway calculation. Burn rate. Time remaining. Your planning.
Read this. Calculate runway. Plan accordingly.
Key Takeaways
- Calculate cash runway—use Cash Runway Calculator to see exactly how many months you have left
- Calculate burn rate—understand your monthly cash burn to project runway accurately
- Update regularly—recalculate runway monthly as cash and burn change
- Plan milestones—use runway to time key decisions like fundraising or cost cuts
- Build buffers—aim for more runway than you think you need to handle surprises
Table of Contents
Why Runway Matters
Runway shows time remaining.
What happens without runway visibility:
- Cash runs out unexpectedly
- Decisions are made too late
- Opportunities are missed
- Business fails
What happens with runway visibility:
- Cash needs are anticipated
- Decisions are made proactively
- Opportunities are captured
- Business survives
The reality: Runway enables survival.
Calculating Cash Runway
Calculate cash runway:
Use Cash Runway Calculator
Calculate it:
- Use our Cash Runway Calculator
- Enter current cash balance
- Enter monthly burn rate
- See months remaining
Why it matters: Accurate calculation shows true time horizon.
Understand the Output
What the output shows:
- Months until cash runs out
- Time available for decisions
- Urgency level
- Planning window
Why it matters: Understanding enables planning.
Pro tip: Calculate runway. Use our Cash Runway Calculator for accurate calculation. See our cash flow safety net guide for comprehensive planning.
Calculating Burn Rate
Calculate burn rate accurately:
Monthly Cash Outflow
What to include:
- All operating expenses
- Payroll and benefits
- Rent and utilities
- Marketing and sales
- Other cash expenses
Why it matters: Complete expenses show true burn.
Exclude Non-Cash Items
What to exclude:
- Depreciation
- Amortization
- Non-cash expenses
- Accrued expenses not yet paid
Why it matters: Only cash expenses affect runway.
Track Trends
What trends to track:
- Monthly burn changes
- Seasonal patterns
- Growth-related increases
- Cost reduction impacts
Why it matters: Trends show burn trajectory.
Pro tip: Calculate burn rate. Include all cash expenses, exclude non-cash items, track trends. Use our burn rate guide for detailed calculation.
Updating Regularly
Update runway regularly:
Monthly Updates
What to update monthly:
- Current cash balance
- Actual burn rate
- Projected runway
- Comparison to previous month
Why it matters: Regular updates maintain accuracy.
When Cash Changes
When to recalculate:
- After fundraising
- After major expenses
- After revenue changes
- After cost changes
Why it matters: Timely updates reflect reality.
Track Changes Over Time
What to track:
- Runway trends
- Burn rate trends
- Cash balance trends
- Projection accuracy
Why it matters: Tracking shows patterns.
Pro tip: Update regularly. Monthly updates, recalculate when cash changes, track trends. See our monthly financial review guide for routine.
Planning Milestones
Plan milestones using runway:
Fundraising Timing
When to start fundraising:
- 6-9 months before runway ends
- Based on typical fundraising timelines
- Account for negotiation time
- Build in buffer
Why it matters: Early start prevents crisis.
Cost Reduction Timing
When to cut costs:
- Before runway gets critical
- When burn rate is unsustainable
- When growth isn’t materializing
- When alternatives are exhausted
Why it matters: Early cuts preserve runway.
Revenue Milestones
What revenue milestones to set:
- Break-even target
- Profitability target
- Growth targets
- Cash-positive target
Why it matters: Milestones guide decisions.
Pro tip: Plan milestones. Fundraising timing, cost reduction timing, revenue milestones. Use runway to guide all timing decisions.
Building Buffers
Build buffers into runway:
Conservative Assumptions
What assumptions to use:
- Higher burn rate than expected
- Lower revenue than projected
- Longer fundraising timelines
- Unexpected expenses
Why it matters: Conservative assumptions build safety.
Target Runway Length
What runway to target:
- Minimum 6 months
- Preferably 12+ months
- More for high-growth businesses
- Adjust for risk level
Why it matters: Longer runway provides flexibility.
Multiple Scenarios
What scenarios to model:
- Best case
- Base case
- Worst case
- Plan for worst case
Why it matters: Scenarios show range of outcomes.
Pro tip: Build buffers. Conservative assumptions, target runway length, multiple scenarios. See our cash flow scenario planning guide for comprehensive modeling.
Your Next Steps
Calculate runway. Update regularly. Plan milestones.
This Week:
- Review this guide
- Calculate current cash runway
- Calculate current burn rate
- Set up monthly tracking
This Month:
- Update runway calculation
- Compare to previous month
- Identify any concerns
- Plan next steps
Going Forward:
- Update monthly
- Track trends
- Plan milestones
- Build buffers
Need help? Check out our Cash Runway Calculator for runway calculation, our burn rate guide for burn calculation, our cash flow safety net guide for comprehensive planning, and our cash flow scenario planning guide for scenario modeling.
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Sources & Additional Information
This guide provides general information about cash runway forecasting. Your specific situation may require different considerations.
For cash runway calculation, see our Cash Runway Calculator.
For burn rate calculation, see our Burn Rate Guide.
For cash flow scenario planning, see our Cash Flow Scenario Planning Guide.
Consult with professionals for advice specific to your situation.
