What is startup runway?

Runway is how many months your startup can operate before running out of cash, given your current burn rate and revenue. The formula is: runway = cash on hand ÷ net monthly burn (where net burn = gross burn − monthly revenue). A runway below 6 months is critical — you should be fundraising or cutting costs immediately. 12–18 months is healthy for an early-stage startup.

What is a good burn rate for a startup?

There is no universal 'good' burn rate — it depends on your stage and funding. Pre-seed solo founders should aim to keep burn under $5,000/month. Seed-stage teams of 3–5 typically burn $30,000–$80,000/month. Series A companies may burn $200,000–$500,000/month while growing revenue. The key metric is burn multiple: total burn ÷ net new ARR. Below 1.5x is efficient; above 3x is a warning sign.

How do I extend my startup runway?

The four levers are: (1) cut costs — delay hires, renegotiate vendor contracts; (2) increase revenue — raise prices, run a pre-sale or waitlist; (3) raise more capital — bridge round, convertible note; (4) reduce scope — ship an MVP instead of a full product. The fastest lever for pre-launch startups is often running a waitlist pre-sale to generate revenue before the product ships.

When should a startup stop building and start a waitlist?

The most common mistake is building for 12 months before testing demand. LaunchList recommends spending the first 4–6 weeks building a landing page and waitlist to validate interest before committing engineering resources. If your runway is under 8 months, validating demand first is not optional — it is the single best use of those weeks. A 300-person waitlist takes 4 weeks to build and costs $0.

Free tool

Startup Runway Calculator

Know exactly how long your money lasts — and when to stop building and start validating.

Your current financials

Enter your cash balance, monthly burn, and revenue to calculate runway and get a pre-launch validation timeline.

Cash on hand

Total liquid cash available today.

Monthly gross burn

Total monthly expenses before revenue.

Monthly revenue

Enter 0 if pre-revenue.

Monthly revenue growth

Month-over-month revenue growth rate.

How runway is calculated

Net burn = gross monthly burn − monthly revenue. Simple runway = cash ÷ net burn. The projected runway accounts for revenue growth month-over-month, which extends runway as revenue approaches burn. The 36-month cash balance chart shows the inflection point where revenue growth might offset burn.

Burn multiple (Sacks/Bessemer) = net burn ÷ net new ARR. Below 1.5x is efficient; above 3x is a warning sign for investors evaluating capital efficiency.

Pre-launch validation timeline

Weeks 1–2

Build landing page + waitlist. Zero engineering commitment. Test your value proposition.

Weeks 3–4

Drive traffic via Product Hunt, Reddit, X, LinkedIn. Target 200–500 qualified signups.

Weeks 5–6

Interview 10–20 signups. Validate willingness to pay. Decide: build or pivot.

Month 2+

Start engineering with validated demand. Burn runway on building, not guessing.

Frequently asked questions

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