What is a Runway?
Runway
Runway is the amount of time a startup can continue to operate before running out of cash, assuming no new revenue is generated.
Detailed Deep Dive
Runway is the amount of time a startup can continue to operate before running out of cash, assuming no new revenue is generated and expenses remain constant. It is calculated by dividing the company's current cash balance by its monthly net burn rate (Runway = Cash / Net Burn). Maintaining a healthy runway (ideally 18 to 24 months after a funding round) is crucial for giving the team enough time to build, scale, and launch a fundraising campaign without running out of cash.
Frequently Asked Questions
Q:How is runway calculated?
Runway = Current Cash Balance / Monthly Net Burn Rate.
Q:What is a healthy runway for a startup?
Ideally, 18 to 24 months of runway after a major funding round, giving the team 12-18 months of focus and 6 months to raise the next round.
Quick Facts
- CategoryMetrics
- Key ApplicationCash flow forecasting and operational planning
Coverage Trend12 Weeks
Related Terms
Runway Media Coverage & Intelligence
No Direct Runway News Today
We currently have no direct coverage articles matching "Runway" in the database archive. Explore trending global tech stories below instead.
Trending Tech Stories
The Control Gap: Enterprise AI organizations have an ownership problem, not a technology problem - and most are governing it by hand
AI portfolios are expanding far faster than the ability to govern them across enterprises. Most organizations run a contested field of platforms, each claiming
SpaceX has an AI device prototype, and it sure sounds phone-ish
SpaceX reportedly showed investors a "handset-like" AI device before going public. It could be another signal SpaceX wants to expand into wireless.
Ashton Kutcher leaving Sound Ventures to launch new VC firm with Morgan Beller
The actor and investor is joining forces with Morgan Beller, who was previously a GP at NFX, to invest in early-stage startups.
You Can Now Sound the Alarm on AI Behaving Badly
Are you worried your AI chatbot is trying to build a bomb or leak personal information about you? There's a website for that.