Glossary — metrics
Burn rate
Burn rate is how much cash a company spends per month, net of revenue — the rate at which it's depleting its bank balance.
How it works
Gross burn = total monthly spend. Net burn = total monthly spend − monthly revenue. Investors care about net burn because it determines runway. A company with $1M in the bank burning $100K/month has 10 months of runway. After raising a round, founders usually plan for 18–24 months of runway.