Free tool

Burn rate and burn multiple calculator

Gross burn is a month's spend, and net burn is spend minus revenue, averaged over three months. The burn multiple divides net burn by the net new ARR it bought. Under 1 is amazing, 1 to 1.5 great, 1.5 to 2 good, 2 to 3 suspect and over 3 bad.

The last three months

Two months ago: spend

Two months ago: revenue

Last month: spend

Last month: revenue

This month: spend

This month: revenue

Net new ARR in these three months

New plus expansion, minus churned annual recurring revenue. Leave empty if you have none.

Net burn a month

$98,000

Average of the three months

Gross burn a month: $138,000
Net burn over the three months: $294,000
Burn multiple: 1.63×

Good: you burn $1.63 for each $1 of new ARR.

$1.63 burned for each $1 of new yearly revenue is rated Good; lower is better

Burn multiple, rated Good: 1.63×
Net burn a month: $98,000
Gross burn a month: $138,000

The calculator's 3-month example: $294,000 of net burn for $180,000 of new ARR, rated by David Sacks' bands (2020). Accountable's Home shows your own net burn from the books.

How it's calculated

Gross burn is the average monthly spend across the months you enter; net burn subtracts each month's revenue.
Use cash collected, not invoices sent, and leave out money raised or borrowed.
The burn multiple is net burn over the months entered divided by the net new annual recurring revenue added in those months.
The bands are David Sacks': under 1 amazing, 1 to 1.5 great, 1.5 to 2 good, 2 to 3 suspect, over 3 bad.

The same numbers from real books: net burn as a 3-month average and runway in months, on Accountable's home screen for the demo company Northwind Labs.

Questions founders ask

What is a good burn multiple?

Under 1.5 is great by David Sacks' bands, and 2 is reasonable for an early-stage startup. Seed companies often start near 3 and improve as sales grow.

What is the difference between gross and net burn?

Gross burn is everything you spend in a month. Net burn is what you spend minus what customers pay you, so it is the number that shrinks your cash.

Why average three months?

One month can swing with an annual software payment, a bonus or a large customer prepayment. A three-month average is what most investors ask for.

What if I have no recurring revenue yet?

Then the burn multiple doesn't apply. Watch net burn and runway instead.

Rules from, checked October 4, 2026: