the.com/burn rate
The speed at which a startup turns investor hope into rent and snacks.
means The pace at which a company spends its cash reserves before new revenue or funding arrives — usually measured per month.
from Compound coinage from everyday 'burn' (to consume rapidly, as in burning fuel or money) plus 'rate' (a measured speed). It entered startup and venture-capital jargon in the late 20th century, especially around the dot-com boom, as founders and investors needed a blunt metric for how fast cash reserves were being incinerated before profitability — or the next funding round — arrived.
- measures
- cash spent per month, not profit
- runway link
- cash left divided by burn equals runway
- founder myth
- growth excuses almost any burn, until it does not
- vc lingo
- low burn signals discipline, zero burn signals no ambition