All termsFUNDING & OPS

Runway

DEFINITION

The number of months a startup can operate before running out of cash at the current net burn rate.

In depth

Runway is the single clearest operational number for an early-stage founder. It tells you how much time you have to hit the next milestone, raise the next round, or become default alive.

Standard advice: maintain at least 18–24 months of runway post-raise so you have room to recover from a single missed quarter. Under 6 months = raise or cut now.

Formula & example

Runway (months) = Cash on Hand ÷ Net Monthly Burn
EXAMPLE$500K in bank, burning $50K/mo → Runway = 10 months.

Rules of thumb

  • Raise at 12 months runway remaining. Don't wait.
  • Cut when you hit 9 months and there's no round in sight.
  • Default alive = revenue growth covers burn growth before runway ends.

Put it into practice

tool
Runway Calculator

Related terms

Burn Rate
How much cash a startup loses per month. Gross burn is total cash out; net burn subtracts revenue.
Default Alive
A startup is Default Alive if its current revenue growth will carry it to profitability before the money runs out — without raising more.

USE THIS IN A REAL PLAN

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PlanMySaaS runs Runway and every other SaaS metric for your idea — part of a full blueprint with architecture, feature specs, 21 docs, and Cursor-ready prompts.

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Last reviewed 14 April 2026 by Abhi Verma.