Business & Sales

What Is Cash Runway?

Cash runway is the number of months a company can keep operating before it runs out of cash, assuming its current spending and income stay the same. It is calculated by dividing cash on hand by the monthly net burn rate.

Formula

Runway (months) = cash balance ÷ monthly net burn. With 600,000 in cash and a 50,000 monthly net burn, runway is 12 months.

Personal Parallel

Emergency fund months — savings divided by monthly expenses — use the same idea for households.

🧮 Calculate It Yourself

Put Cash Runway into practice with these free calculators — no sign-up, nothing stored.

🛟 Emergency Fund Calculator How much should you have saved for the unexpected? Calculate → 📊 Break-Even Point Calculator How many units do you need to sell before your side business profits? Calculate →

🔗 Related Terms

Burn Rate Cash Flow Emergency Fund Working Capital

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Last updated: September 29, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.