Cash Runway
Cash Runway is a SaaS metric that shows how many months your company can continue operating at its current burn rate before running out of cash.
Tracking this metric helps you make better decisions about cost management, growth, and fundraising.
A longer runway indicates stability and more time to grow or raise capital.
A shorter runway signals the need for immediate action, such as reducing expenses or securing new funding.
This metric is especially important for startups and scaling businesses that rely on external investment to sustain operations.
How Cash Runway Is Calculated
Cash Runway measures your available cash balance against how much cash you are spending (net burn).
Cash Runway Formula:
Cash Runway = Cash Balance ÷ Average Net Burn (last 90 days)
The calculation depends on two key inputs, explained below.
Net Burn
Net Burn is the net amount of cash lost each month after accounting for inflows and outflows. To learn how it’s calculated, see📄 Net Burn.
Cash Balance
Cash Balance is the actual cash held across all bank accounts at the end of each month. For Cash Runway purposes, Rillet uses the bank balance, which may differ from the GL balance due to reconciliation adjustments.
Frequently Asked Questions (FAQ)
How does Rillet handle funding inflows when calculating Net Burn?
Rillet automatically excludes large inflows to equity accounts from Net Burn. These inflows only affect the Cash Balance part of the calculation, not the burn rate.
See Also
Learn more about burn and revenue metrics:
See Also:
Check related cash flow and sustainability metrics:
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