Burn Rate Calculator and Analysis
Operations & HR Finance
Quick Answer
Enter your monthly costs and revenue. Paste into Claude or ChatGPT. Get gross and net burn calculation with burn multiple, runway, and recommendations to optimize spending.
What You Get
A burn rate analysis covering gross and net burn calculation, burn multiple assessment, burn efficiency relative to ARR growth, runway calculation, comparison to stage-appropriate benchmarks, and specific recommendations to optimize the burn rate.
Who Is This For
Startup founders monitoring cash consumption, CFOs reporting burn rate to investors and boards, and pre-revenue startups managing limited capital.
About This Template
Burn rate is the rate at which a startup consumes its cash reserves. Understanding your burn rate — and whether it is appropriate for your stage and growth — is fundamental to making good financial decisions. This template guides founders through entering their monthly costs and revenue, then uses AI to calculate gross and net burn, assess burn efficiency relative to growth, compare to benchmark burn rates for the stage, and produce specific recommendations for optimizing the spend.
Fill In Your Details
Your company name
e.g. 720000
e.g. 850000 or 0 if pre-revenue
e.g. 2400000
e.g. Salaries $420K, Sales and marketing $180K, Engineering $80K, G&A $40K
e.g. 85 percent year-over-year growth
e.g. Seed, Series A, Series B
Gather these details then use them to fill in the prompt below.
AI Prompts
Generate burn rate analysis
Paste this prompt into Claude or ChatGPT with your data filled in.
You are a CFO analyzing startup burn rate and cash efficiency. Using the data below, produce a comprehensive burn rate analysis. Company: [company_name] Monthly costs: [monthly_costs] Monthly revenue: [monthly_revenue] Cash balance: [cash_balance] Cost breakdown: [cost_breakdown] ARR growth rate: [arr_growth] Funding stage: [funding_stage] Calculate and produce: 1. Gross Burn Rate — total monthly costs 2. Net Burn Rate — monthly costs minus monthly revenue 3. Runway — months of runway at current net burn 4. Burn Multiple — net burn divided by net new ARR (how many dollars burned per dollar of new ARR added). Benchmark: under 1x is excellent, 1-1.5x is good, 1.5-2x is acceptable, above 2x is concerning. 5. Cost Efficiency Analysis — cost breakdown assessment, which categories are proportionate and which seem high 6. Stage Benchmark Comparison — is this burn rate appropriate for the funding stage and growth rate 7. Optimization Recommendations — specific actions to reduce burn if appropriate, or confirmation that burn is well-managed Be direct. If burn is too high for the growth rate, say so clearly.
Sample Output
This is an example of what AI produces when you use this template.
Burn Multiple Assessment
Net burn: $720,000 costs minus $850,000 revenue equals positive $130,000 — this business is cash flow positive, not burning. Gross burn: $720,000 per month. Since the business is generating positive cash flow, the burn multiple framework does not apply. The more relevant metric is cash efficiency: the business generates $130,000 in free cash flow per month on $720,000 of costs — an 18 percent cash flow margin. This is exceptional for a company growing at 85 percent annually. Most companies at this growth rate are burning $200,000-$400,000 per month — being cash flow positive while growing at 85 percent places this business in the top 5 percent of SaaS efficiency.
Cost Efficiency Analysis
Sales and marketing at $180,000 (25% of costs) is lean for 85% growth — most companies growing this fast spend 35-45% of revenue on S&M. This suggests either very efficient acquisition (CAC data would confirm) or potential underinvestment in growth that could be limiting the growth rate. Engineering at $80,000 (11% of costs) is low — monitor whether product velocity is keeping up with customer needs. G&A at $40,000 (6% of costs) is appropriate and efficient. Salaries at $420,000 (58% of costs) is the dominant cost as expected and appears proportionate to the team size implied.