Metrics & Performance
Runway
Also Known As
Cash RunwayBurn Runway
Runway is the amount of time a startup can continue operating at its current burn rate before running out of cash, typically expressed in months.
What is Runway?
Runway tells you how long until the money runs out. It's one of the most critical metrics for early-stage startups. Running out of runway means running out of business.
Calculating Runway
Formula:
Runway (months) = Cash Balance / Monthly Burn Rate
Example:
- Cash: $1,200,000
- Monthly Burn: $100,000
- Runway: 12 months
Runway Benchmarks
| Stage | Ideal Runway |
|---|---|
| Pre-seed | 12-18 months |
| Seed | 18-24 months |
| Series A | 18-24 months |
Extending Runway
- Reduce burn: Cut costs
- Increase revenue: Accelerate sales
- Raise capital: New funding
- Bridge financing: Short-term loans
- Revenue-based financing: Non-dilutive capital
Studio Runway Support
Venture studios help manage runway by:
- Providing initial capital
- Offering shared services (lower burn)
- Supporting fundraising timing
- Sometimes providing bridge funding
Example Usage
“With 18 months of runway, they had time to find product-market fit before needing to raise again.”