Burn Rate Calculator
(Gross & Net Burn Tool)
Enter monthly expenses and revenue to get gross and net burn. Add cash on hand to see how long it lasts.
Step 1 — Monthly Operating Expenses
Step 2 — Revenue & Cash
Total cash coming in from sales this month
Optional — see how long your current cash lasts at this burn rate
Calculated Results
Enter your monthly expenses to calculate gross and net burn rate.
This burn rate calculator works out how fast a business is spending its cash. Enter monthly expenses for gross burn, add monthly revenue for net burn, and add cash on hand to see how many months the money lasts.
How to Calculate Burn Rate
| Monthly item | Amount |
|---|---|
| Payroll | $35,000 |
| Rent and office | $3,000 |
| Software and tools | $1,500 |
| Marketing | $4,000 |
| Other | $2,000 |
| Gross burn | $45,500 |
| Revenue | −$8,000 |
| Net burn | $37,500 |
This company spends $45,500 a month and its bank balance falls by $37,500 a month.
Gross Burn and Net Burn Answer Different Questions
Gross burn shows the size of the cost base: what the business must pay each month whether or not anyone buys. Net burn shows how quickly cash is running down. Two companies with the same net burn can be in very different positions. One with $45,500 of costs and $8,000 of revenue loses everything if revenue stops; one with $200,000 of costs and $162,500 of revenue has far more to lose from a bad month, and far more room to cut.
Burn Rate From Bank Balances
If you do not have expenses itemised, the bank statements give net burn directly.
A balance that went from $600,000 to $487,500 over three months is a net burn of 112,500 ÷ 3 = $37,500 a month. Take out money raised from investors or loans in that period first, or burn will look lower than it is. Averaging three months also smooths out bills that are paid quarterly or yearly.
From Burn Rate to Runway
With $500,000 in the bank and a net burn of $37,500, runway is 500,000 ÷ 37,500 = 13.3 months. That assumes costs and revenue stay as they are. If costs are set to rise, for example through hiring, the Startup Runway Calculator lets burn grow each month.
What to Leave Out
- Non-cash expenses: depreciation and share-based pay do not leave the bank.
- One-off items: a single large purchase or a yearly insurance bill distorts one month. Spread it or note it separately.
- Money raised: investment and loans are not revenue. They add to cash on hand, not to the monthly figures.
How to Use the Burn Rate Calculator
- Enter monthly expenses: Type what the business spends each month on payroll, rent, software, marketing and everything else.
- Enter monthly revenue: Type the cash that comes in from customers each month. Leave it empty if there is none yet.
- Read gross and net burn: Gross burn is the total of the expenses. Net burn is that total minus revenue.
- Add cash on hand: Optional. Enter the cash in the bank to see how many months it lasts at this net burn.
Frequently Asked Questions
How do I calculate burn rate?
Add up the cash spent in a month for gross burn. Subtract the cash received from customers for net burn. A company that spends $45,500 and takes in $8,000 has a gross burn of $45,500 and a net burn of $37,500.
What is the difference between gross burn and net burn?
Gross burn is everything spent in a month. Net burn is what is spent beyond what comes in, so it is the amount by which the bank balance falls. Runway is worked out from net burn.
How do I calculate burn rate from bank balances?
Subtract the closing cash balance from the opening balance and divide by the number of months. A balance that went from $600,000 to $487,500 over three months is a net burn of $112,500 ÷ 3 = $37,500 a month. Leave out money raised or borrowed in that time.
What does a negative net burn mean?
Revenue is higher than spending, so cash is growing. The calculator shows runway as cash-flow positive in that case.
Does burn rate include non-cash expenses?
No. Burn is about cash leaving the bank. Depreciation and share-based pay are expenses in the accounts but do not use cash, so they are left out.
How is burn rate related to runway?
Runway is cash on hand divided by net burn. $500,000 in the bank and a net burn of $37,500 a month gives 13.3 months.
Formulas and worked examples checked in October 2026.