What is a good burn rate for a startup in 2026?

Burn rate benchmarks vary by stage. Pre-seed: $15,000 to $50,000/month. Seed: $50,000 to $150,000/month. Series A: $150,000 to $500,000/month. Series B: $400,000 to $1,500,000/month. The key metric is not absolute burn but burn relative to revenue growth and runway remaining.

How much runway should a startup have?

The standard recommendation in 2026 is 18 to 24 months of runway after each funding round. This provides sufficient time to hit milestones and begin the next raise. Less than 12 months is considered a danger zone. More than 30 months may indicate under-investment in growth.

What is the difference between gross and net burn?

Gross burn is total monthly expenses. Net burn is expenses minus revenue. For pre-revenue startups, they are the same. For revenue-generating companies, net burn is the more relevant metric because it reflects actual monthly cash consumption. However, gross burn is important for understanding what happens if revenue drops to zero.

How do I calculate the funding gap?

Funding gap = (Target runway in months x monthly net burn) - current cash on hand. If your net burn is $100,000/month, you want 18 months of runway, and you have $800,000 in cash: gap = (18 x $100,000) - $800,000 = $1,000,000. Raise at least $1M, ideally with a buffer for slower-than-expected growth.

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Burn Rate and Runway Calculator

Calculate monthly net burn rate, gross burn, cash runway in months, funding gap, and 24-month cash projection for startups using 2026 venture capital benchmarks by stage.

Startup Financial Details

Cash on Hand ($)

Company Stage

Monthly Financials

Monthly Revenue ($)

Enter 0 for pre-revenue startups

Monthly Revenue Growth (%)

Month-over-month growth rate

Monthly Operating Expenses ($)

Monthly Expense Growth (%)

Planned hiring, scaling costs, etc.

Planned Funding (Optional)

Expected Funding Amount ($)

Expected Funding Timeline (months)

Months from now until funding closes

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Introduction

This Burn Rate Runway is designed for professionals who need accurate and reliable calculations in their daily work. Whether you are planning finances, managing projects, or making critical business decisions, having the right numbers at your fingertips is essential. This tool provides instant results based on proven formulas, saving you time and reducing the risk of manual calculation errors. By using this calculator, you can focus on analysis and decision-making rather than spending time on complex computations. The interface is straightforward and designed for practical use, ensuring that you get the information you need quickly and efficiently.

What This Calculator Does

This burn rate and runway calculator computes both gross burn rate (total monthly expenses) and net burn rate (expenses minus revenue) for startups and growing businesses. It projects cash runway in months, generates a 24-month cash forecast accounting for revenue growth and expense scaling, calculates the funding gap needed to reach a target runway, and identifies the exact month when cash runs out. The calculator supports pre-revenue startups and revenue-generating companies at every stage from pre-seed through Series C+. Benchmarks reflect 2026 venture capital and startup operating data.

The Formula

Net Burn = Monthly Expenses - Monthly Revenue | Runway (months) = Cash on Hand / Net Burn | Funding Gap = (Target Runway x Net Burn) - Cash on Hand

Gross burn rate is total monthly operating expenses regardless of revenue. Net burn rate subtracts revenue, showing the actual monthly cash consumption. Runway divides available cash by net burn to determine how many months the company can operate before running out of money. When revenue growth and expense growth rates are provided, the calculator projects forward month by month, compounding growth rates to show a realistic cash trajectory rather than a simple linear calculation.

Step-by-Step Example

Enter financial position

Seed-stage startup with $1,500,000 cash on hand, $50,000 monthly revenue, and $120,000 monthly expenses.

Calculate burn rates

Gross burn: $120,000/month. Net burn: $120,000 - $50,000 = $70,000/month.

Calculate runway

Static runway: $1,500,000 / $70,000 = 21.4 months. With 8% monthly revenue growth and 3% expense growth, projected runway extends as revenue approaches expenses.

Assess funding needs

At 21 months of runway, the company is in healthy position. Funding gap for 18-month target: $0 (already exceeded). Begin fundraising planning at month 12 to 14.

Real-World Use Cases

Fundraising Planning

Founders use runway calculations to determine when to begin the next fundraising round. Since most rounds take 4 to 6 months to close, starting at 12 to 14 months of remaining runway is standard practice.

Board Reporting

CFOs present burn rate, runway, and cash projections in monthly board updates. The 24-month projection helps board members understand the cash trajectory under current assumptions.

Scenario Planning

Model the impact of hiring decisions, revenue growth assumptions, and expense changes on runway. If adding 5 engineers increases burn by $75,000/month, the calculator shows exactly how that affects runway.

Common Mistakes to Avoid

Using gross burn instead of net burn for runway calculations. A company burning $200,000/month gross but generating $120,000 in revenue has a net burn of $80,000. Using gross burn overstates the problem by 2.5x.
Not accounting for revenue growth when calculating runway. A company growing revenue 10% month-over-month will have a much longer effective runway than the static calculation suggests.
Waiting too long to fundraise. If fundraising takes 4 to 6 months, starting with only 6 months of runway leaves zero margin for delays. Start fundraising at 14 to 18 months of remaining runway.
Ignoring one-time expenses in burn calculations. Legal fees, equipment purchases, and security deposits create temporary burn spikes that overstate the steady-state run rate.

Frequently Asked Questions

Accuracy and Disclaimer

Burn rate and runway calculations are projections based on current financial data and growth assumptions. Actual results will vary based on market conditions, revenue performance, hiring pace, and unexpected expenses. This calculator is for financial planning purposes and does not constitute investment or fundraising advice. Consult your CFO or financial advisor for funding decisions.

Conclusion

This calculator provides a reliable way to perform essential calculations for your professional needs. The results are based on standard formulas and should be used as estimates for planning and analysis purposes. For critical decisions, especially those involving financial, legal, or medical matters, it is always advisable to verify results with a qualified professional. Use this tool as part of your broader decision-making process, and explore related calculators on this platform to support your comprehensive planning needs. Regular use of accurate calculation tools helps ensure consistency and precision in your professional work.