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Finance

What is Burn rate?

How much cash a company spends per month.

Gross burn is total monthly spend; net burn is spend minus revenue. Net burn determines runway.

Example

₹15 lakh spending − ₹3 lakh revenue = ₹12 lakh net burn.

Go deeper · Founder Playbook, Level 9Bookkeeping, cash flow and runway for founders →

Related terms

RunwayCash flow

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