How long have you really got?
Runway is how long until the money runs out: cash in the bank, divided by what you lose each month (your burn). Every founder watches the company’s runway. But you have two, and the one that ends most startups is the founder’s own bank account: your savings, your rent, the month you personally can’t carry on. This tool puts both clocks side by side and tells you which one is really ticking.
Rough guesses are fine; you can tune everything. The defaults already show how the maths works, so you get an answer before you type a thing.
Growth in dollars, not percent: if you added one $150-a-month customer last month, that’s $150.
Runway assumes today’s burn, but burn isn’t static. Paul Graham, co-founder of the startup accelerator Y Combinator, calls the question that actually matters default alive or default dead: if you keep growing at today’s rate, does revenue cover your costs before the cash hits zero? Here’s your trajectory:
▬ your revenue, growing at $175a month ▬ your costs, $5k a month ● revenue covers costs, month 29 | cash runs out, month 14
The lines do cross, in month 29, but your cash runs out in month 14, first: default dead. The deepest the hole gets is about $19k. That’s your funding gap: cover it, plus three months of costs as buffer, and the business makes it to the far side. Which is why the answer to “how much should I raise?” is about $34k, not “a round”.
Your company has 10 months. You have 15 months. Your real deadline is 10 months. On this trajectory you’re default dead, but the fix has a number: you don’t need “a round”, you need about $34k.
- Real deadline
- 10 months
- Funding gap
- $19k
- Raise about
- $34k
Default alive or default dead: Paul Graham, “Default Alive or Default Dead?”, paulgraham.com, October 2015. Everything else is your own numbers run through the book’s cashflow model (Chapter 12): runway = cash ÷ monthly burn; raise target = the deepest cash trough plus three months of costs. A model, not data.
Next: the same startup, two paths→
The book goes deeper in Chapter 12 (three forecasts that tell you if you’ll run out of money, and how to find your funding gap) and Chapter 13 (the three numbers that replace a 50-page financial model).
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