Subscription Revenue Runway Calculator

How to calculate Subscription Runway?

Runway is the number of months your business can operate before running out of cash, considering your monthly net burn.

Formula: Cash Balance / (Monthly Expenses - (MRR * (1 + Growth - Churn)))

Using the Runway calculator: an example

Consider a startup with $200k cash, $20k MRR, and $30k in monthly expenses.

Step-by-step calculation:

• Calculate Monthly Net Burn: $30,000 - $20,000 = $10,000
• Apply Growth/Churn: Adjust MRR by the net growth rate (e.g., 5% growth - 2% churn)
• Divide Cash: $200,000 / $10,000 = 20 months runway.

Frequently Asked Questions

What is the difference between Gross Burn and Net Burn?

Gross burn is the total amount of spending per month, while net burn is the total money lost (expenses minus revenue).

How does churn impact my runway?

High churn reduces your recurring revenue faster, increasing your net burn and significantly shortening your runway even if you have high growth.