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by Undo Capital
December 15, 2025
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What Is Runway (Months of Cash Left)?

Runway is the number of months a company can continue operating before running out of cash, based on its current burn rate.

Runway (Months of Cash Left) Meaning

The runway's meaning centres on financial visibility and survival. To define runway in practice, it is calculated by dividing the company’s available cash by its monthly net burn rate, revealing how long the business can operate without new revenue or funding. A clear runway definition is essential for founders preparing funding rounds, managing expenses or evaluating growth plans. Investors often assess runway alongside burn rate to determine whether a startup is on a sustainable path or at risk of liquidity pressure. Runway stands for financial discipline, planning and readiness to raise capital.

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Disclaimer: Our services are designed to assist startups and businesses with company formation, legal agreements, and funding-related documentation. We do not provide investment advice, financial advice, or tax advice, nor are we regulated by the Financial Conduct Authority (FCA). Participating in startups and early-stage enterprises carries inherent risks, including limited liquidity, absence of dividends, potential loss of investment, and dilution. Any decisions regarding investments should be made independently by the investor as part of a well-diversified portfolio.