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KN

Kirsty Nathoo

08/22/19

@ Y Combinator

Your runway is how long you can operate before running out of money, calculated by dividing your bank balance by your average burn rate.

Video

YC

Kirsty Nathoo - Managing Startup Finances

@ Y Combinator

Kirsty Nathoo - Managing Startup Finances

08/22/19

Related Takeaways

TB

Tom Blomfield

12/16/23

@ Y Combinator

Include burn rate and runway in investor updates; these metrics are crucial for understanding your startup's financial health.

KN

Kirsty Nathoo

08/22/19

@ Y Combinator

Calculating your burn rate is straightforward: it's the difference between money in and money out, which you can find in your bank statements.

KN

Kirsty Nathoo

08/22/19

@ Y Combinator

If you have six months of runway left, you should start thinking about raising money or achieving profitability, as waiting too long can reduce your leverage with investors.

DC

Dalton Caldwell

10/23/24

@ Y Combinator

Burn rate refers to the amount of money a startup spends each month; it's crucial for founders to monitor this to ensure they don't run out of funds, even if they have high revenue.

KN

Kirsty Nathoo

08/22/19

@ Y Combinator

Runway is not just a vanity metric; it's crucial for understanding the health of your company. Don't ignore it or manipulate the numbers to feel better about your situation.

DR

David Rusenko

09/06/18

@ Y Combinator

Keep your burn rate low; if you only have enough cash for a few iterations but need many more, it won't work.

SF

Shana Fisher

06/20/14

@ Y Combinator

When raising money, it's crucial to focus on making whatever you raise last, rather than just aiming for a specific runway duration.

OG

Ooshma Garg

09/08/18

@ Y Combinator

Our monthly burn was kept low at $40,000 by maintaining a small team of co-founders, which allowed us to extend our runway while iterating on our product.

JL

Jessica Livingston

05/04/17

@ Y Combinator

Live cheaply at the beginning to extend your runway; startups often take time to figure out what they should be doing, and overspending can lead to running out of time for necessary evolution.