How to track runway as a founder

Runway is the number of months your company can keep operating before the cash runs out. It is the single figure most founders wish they had checked sooner. This guide shows how to calculate it, how to keep it honest, and how to turn it into a weekly habit.

By Tansher Dhawan, Founder, Trenston. 2026-10-18.

What runway means

Runway is your cash balance divided by your monthly net burn. Net burn is the amount of cash you lose each month after counting the cash that comes in.

If the business earns more cash than it spends, there is no burn and runway is not a concern. If it spends more than it earns, runway tells you how many months you have to fix that.

The formula

Runway in months = cash in the bank / monthly net burn.

Monthly net burn = cash going out each month minus cash coming in each month.

A worked example

These numbers are an illustration, not a benchmark. Say a company has $120,000 in the bank. It spends $40,000 a month and collects $25,000 a month from customers.

Net burn is $40,000 minus $25,000, which is $15,000 a month. Runway is $120,000 divided by $15,000, which is 8 months.

Notice what happens if spending rises to $50,000 and nothing else changes. Net burn becomes $25,000 and runway drops to 4.8 months. Small changes in spending move runway a lot, which is why it needs checking often.

Mistakes that make runway look better than it is

Using revenue instead of cash. An invoice you sent is not cash until the customer pays it.

Using one good month. Average the last three months of burn so a single quiet month does not flatter you.

Forgetting one-time costs. Annual software fees, taxes, equipment and a planned hire all reduce cash even if they are not in a normal month.

Counting money you do not control. Funds you owe to someone else or have set aside are not available to spend.

Never setting a floor. Decide the minimum cash you want to keep, and treat that as zero when you calculate runway.

How often to check it

Check runway weekly. Cash moves with every payment and payroll run, and monthly checks let a problem grow for weeks before you see it.

There is no single right number of months. Many founders start acting when runway gets short, because raising money, cutting costs or growing revenue all take time. How early you need to act depends on how fast you can do each of them.

How to track it

You can track runway in a spreadsheet: one row for cash in, one for cash out, and a formula for the result. It works until the data goes out of date, which is the usual way a spreadsheet runway number goes wrong.

Whatever you use, the figure is only as good as how recently the cash data was updated. Make one person responsible for updating it, and check the date as well as the number.

Tracking runway in Trenston

Trenston calculates runway from the revenue and expenses logged in Financials, or from a connected accounting tool such as QuickBooks, Xero or SAP Business One. It shows burn and runway in your daily Briefing.

You can set a minimum cash reserve so Trenston warns you before cash gets tight. When data is missing, it shows "Add data" instead of inventing a zero.