runway
Runway measures how long your company can keep operating at current burn rate before running out of cash.
This metric shows how many months a business can operate before cash runs out. It’s simple—but critical. You calculate it by dividing available funds by monthly spend. The result gives you a timeline. It sharpens focus and pushes decisions forward.
This number isn’t just a financial checkpoint. It’s a decision-making tool. It determines how fast you can grow, when you need to raise, and how much risk you can afford to take. Runway makes time visible—and time is everything when you’re building fast.
How teams use runway to shape strategy
A startup has $1.5M in the bank and burns $150K per month. That gives them 10 months of runway. Leadership maps hiring plans and GTM investments to fit that window. Their fundraising strategy isn’t based on vibes—it’s based on math.
In another case, a founder realizes their current plan leads to zero cash in five months—before the product is ready. They pause expansion, cut costs, and extend runway by three months. That breathing room turns panic into focus.
What people get wrong about runway
Some teams calculate it once, then forget it. Others assume fixed burn, when in reality, spend fluctuates. That’s why smart teams track dynamic runway—updating the number with real-time data. Another trap: measuring runway without milestones. Time only matters if you use it well.
And perhaps the most common error: planning for the fundraising finish line, not the close. If you start raising when runway hits zero, it’s already too late. You don’t need cash when you’re out. You need it when you still have options.
Time isn’t free—it’s strategic
Runway isn’t just a countdown. It’s a constraint that brings focus. It reminds teams that capital is not infinite—and that urgency, used well, is a superpower. Knowing how long you have lets you control the story, not react to it. Because in startups, how you use time is often the difference between growth and shutdown.
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