The formula, without the mystery.
Monthly net burn = cash outflows − cash inflows; runway = available cash / monthly net burn
A worked example
With 30,000 available cash, 8,000 monthly cash receipts and 13,000 monthly payments, net burn is 5,000 and estimated runway is six months.
What if the business generates cash?
When inflows cover outflows there is no finite depletion time under these assumptions. The tool explains that case instead of displaying a misleading infinity. Timing, seasonality and exceptional payments still matter.
Keep the assumptions consistent
Use one planning period and one currency. Enter amounts consistently excluding sales tax or VAT. These simplified models do not account for uncertainty, inventory limits, working capital or progressive taxes. Results are planning estimates.