What is Runway?

Runway is the amount of time (usually measured in months) that a company can continue to operate before it runs out of cash, assuming its current income and expenses remain constant. It is a critical survival metric for pre-profitable startups.

For Startups: Founders need to constantly monitor their runway to know when they need to start their next fundraising round or take measures to reduce their burn rate. A healthy runway (typically 18-24 months after a funding round) provides the time needed to achieve key milestones. Use our Runway Calculator to check yours.

For SaaS: In SaaS, a significant churn event or a failure to close expected large deals can drastically shorten the runway, making careful cash flow forecasting essential.

Calculation: Runway (in months) = Current Cash Balance / Monthly Net Burn Rate.

Example: If a startup has ₹1 Crore in the bank and a net burn of ₹10 Lakhs per month, its runway is 10 months.