Finance Burn Rate Calculation
Burn Rate: How Long Can Your Startup Survive?
Burn rate, a critical metric for startups and companies undergoing rapid growth, represents the rate at which a company is spending its cash reserves. Understanding and managing burn rate is crucial for survival, especially in the early stages when revenue may be limited or non-existent. It helps determine how long a company can operate before it runs out of money, often referred to as its “runway.”