Metric guide · Cash and margin
Runway: months of cash left
Short answer
Runway is how long a company's cash on hand will last at its current net burn. It is calculated as cash on hand divided by monthly net burn, giving a number of months. Sondola stores runway in days, using cash on hand and net burn, and can display it in months.
The formula
Runway (months) = cash on hand ÷ monthly net burn
Unit: Days, shown in months. Better when it goes up.
Enter cash and net burn to see months left and the month cash runs out, with burn growth.
Open the calculatorHow to calculate it
- Take cash on hand from your bank accounts on a specific date.
- Calculate monthly net burn, ideally as a trailing three-month average.
- Divide cash on hand by monthly net burn to get months of runway.
- Multiply by the average days in a month if you need the figure in days.
Mistakes that distort it
Gross burn ignores revenue and shortens runway on paper. Use net burn unless you are modeling a scenario where revenue stops.
Runway assumes burn stays at its current level. Planned hires, price changes or a revenue decline move it, so recalculate after each change.
Undrawn credit and commitments that have not been paid are not cash on hand. Model them as a separate scenario.
Where Sondola reads it from
Sondola reads this metric from Mercury, QuickBooks Online and Xero, with the source and period on every reading. Each reading keeps where it came from, the period and the date it was recorded, and you can download all of it at any time.
See all 34 integrations →Questions
What if net burn is zero or negative?
If the company takes in at least as much as it spends, runway is not limited by burn. Report it as not applicable rather than as a huge number.
Why does Sondola store runway in days?
Days avoid rounding errors from months of different lengths. The metric key is runway_months for historical reasons, and a display can render months from the stored days.
Related metrics
Written by the Sondola team. Benchmarks name their source, basis and date. Changes to how Sondola counts a number are on the corrections page.
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