burn rate
/bɜːrn reɪt/
CommonHow fast a company is spending money, usually measured per month.
Almost always used in the context of startups with finite funding. Can be 'gross burn' (total spend) or 'net burn' (spend minus revenue). The distinction matters but most casual uses mean net burn.
Real-world examples4 examples
| # | Example | What it means | Source |
|---|---|---|---|
| 01 | $800k monthly burn rate and they just laid off 20%. that math isn't working. | Even with layoffs, the company is losing money too fast to survive long. | x, 2024 |
| 02 | our burn rate was $60k a month and we had 18 months of runway. we used every day of it. | The company had enough time to figure things out before running out of money. | linkedin, 2023 |
| 03 | investors ask about burn rate on the first call now. no one wants to fund another zero-path-to-profit company. | After overvalued companies collapsed, investors scrutinize spending much earlier. | x, 2023 |
| 04 | you can raise a series b but if your burn rate triples you just bought yourself the same problem. | More money doesn't solve unsustainable spending. It just delays the reckoning. | reddit, 2024 |
Use it when
- Discussing how long a startup's money will last.
- Explaining why a company needs to raise again soon.
- Questioning whether a company is spending too aggressively.
- Calculating runway: how many months before the money runs out.
Do not use it when
- The company is profitable and spending from revenue, not from reserves.
- You mean cost structure or operating expenses in a general business context.Use “operating costs” instead.
Burn rate vs runway
burn rate
Burn rate is how fast you spend. It's measured in dollars per month.
VS
runway
Runway is how long you have before the money runs out. It's measured in months.
Origin and context
Financial term that entered startup vocabulary during the dot-com era. Became mainstream startup vocabulary in the 2010s as VC-backed companies routinely operated at a loss while chasing growth.
- First seen
- 1990s
- Confidence
- medium
Cite this page
Use this stable URL to reference the entry.
https://slang.fyi/burn-rateUpdated: 2026-08-28License: CC BY 4.0