What this result means
The result estimates how many months current cash could cover the ongoing monthly net cash burn if the entered pattern continued.
How the Cash Runway Calculator works
If receipts cover expenses, cash is not declining under these assumptions. Actual cash flows can be irregular.
The calculator does not fetch live prices or rates. That is intentional: you provide the tariff, price, rate or cost that actually applies to your situation, which makes the assumptions visible and avoids presenting stale market data as current.
How to get a more useful estimate
- Use cash receipts rather than accounting revenue if timing differs materially.
- Model payroll, rent, debt service, taxes, and recurring operating costs realistically.
- Run downside scenarios for slower collections or unexpected expenses.
Scenario check
Use runway as an early-warning measure rather than a forecast. If the result is eight months, list large payments that will occur inside those eight months and check whether monthly averages hide a sharper cash low point. Rerun the model with slower collections and higher expenses to see how much time disappears in a downside case.
Important limitations
- Cash flow is assumed constant each month.
- One-off investments, debt draws, taxes, and seasonal swings are excluded unless reflected in inputs.
- If receipts equal or exceed expenses, the model reports that cash is not declining rather than an infinite number.
Frequently asked questions
What is cash burn?
It is the amount by which monthly cash expenses exceed monthly cash receipts.
Why use cash receipts instead of revenue?
A business can record revenue before cash is collected. Runway is about liquidity, so actual cash timing matters.
Does a long runway mean the business is healthy?
Not necessarily. Runway only describes liquidity under the assumptions entered; profitability, growth, debt, and future obligations still matter.