Burn Rate: Definition, Formula, and Example Calculation
In short, tracking and managing burn rate isn’t just about survival—it’s about planning for future success. A well-managed burn rate ensures a business can operate burn rate formula smoothly, secure funding when needed, and ultimately reach profitability without unnecessary risk. For example, if a company calculates that it has six months of runway left, it might decide to raise more funds now rather than waiting until it’s too late. Companies that don’t track their...