← Business Dictionary
Finance

Burn Rate

How much cash your company spends (beyond what it earns) each month before it becomes profitable.

Example

Spending ₹12,00,000 but earning ₹2,00,000 a month is a ₹10,00,000 monthly burn.

Formula

Net Burn = Cash Spent − Cash Earned (per month)

Related terms

Runway
How many months you can keep operating before you run out of cash, at your current spending rate.
Break-even
The point where your revenue exactly covers your costs — no profit, no loss. After this, you start making money.

Building a startup?

Base 91 Hub takes founders from idea to launch — tracker, community, AI toolkit and this dictionary, built in.

Create your account