# Startup Runway

Runway, also known as start-up runway, is the amount of time that a start-up can continue operating in the market before it runs out of money, assuming that its income and expenses will remain constant during this time.

You can think of start-up runway a lot like an airport’s runway. There’s only a limited amount of room that an airplane can use. Once this runs out, it’s game over, much like it could be game over for a start-up that doesn’t have enough money to keep its operations running with.

Calculating Runway is relatively straightforward for start-ups that have at least a few months’ worth of income and expenditure figures behind them. Naturally, the more figures you’ve got (i.e., a few years’ worth vs a few months’ worth), the more accurate Runway calculations will be.

You can calculate it using this simplified formula:

**Runway = current cash balance ÷ burn rate**

[Source: Pry](https://pry.co/blog/startup-runway)

## Startup Runway Explained:

Short Startup Runway 😰 High Burn Rate - YouTube

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[Short Startup Runway 😰 High Burn Rate](https://www.youtube.com/watch?v=_O_N2v1hE74)

## FAQs

### Why does startup runway matter?

It's an important metric for planning and decision-making in the early stages and helps startups determine their financial health, fundraising needs, and operational priorities to sustain and grow their business.

### What is startup runway?

Startup runway refers to the time a startup can operate before it exhausts its available funding. It's typically measured in months based on current cash reserves and projected expenses.

### What factors can impact startup runway?

Burn rate (monthly expenses), revenue growth, fundraising efforts, market conditions, and operational efficiency can all shorten or lengthen the runway.