What is runway?

The short definition and formula

Runway (months) = cash in the bank / net monthly burn

Net burn is what goes out each month minus what comes in. With $60,000 in the bank, $9,000 of costs a month and $4,000 of revenue, net burn is $5,000 and runway is 12 months. Gross burn is the $9,000 before revenue; it tells you how fast you would run out if revenue stopped.

When revenue covers costs, net burn is zero or negative, and runway stops counting down.

Runway for indie makers

For a solo founder the company and the person often share a bank account in practice. The useful version counts personal costs too: rent, food, health insurance, taxes. Savings divided by monthly living costs minus product income is how long you can work on this before you need a job or a client.

It is also the number that makes the side project versus full time decision concrete. If MRR covers half your costs, your savings last twice as long, and each new customer extends it.

Making it longer

There are only two levers: spend less or earn more. Cutting tools you do not use and hosting you over-provisioned is quick. Raising prices for new customers, moving people to yearly plans (cash up front) and cutting churn all bring cash forward or keep it.

Recalculate monthly. Runway that was 18 months in January is not 18 months in June unless revenue grew to match.

Sharing it

Some founders who build in public share runway alongside revenue, because "eight months left" is a story people follow. If you share revenue, make it a number people can trust: makerhandle shows MRR straight from your payment provider with a check mark, see how to verify startup revenue.