How a Startup's Net Burn Rate Is Calculated

Net burn rate is the difference between a company's total cash outflows and total cash inflows over a specific period, usually a month. Cash outflows include operating expenses, capex, and debt service. Inflows include revenue, grants, and other receipts. The result is the net cash consumed. Net burn is distinct from gross burn, which counts only outflows. Net burn is the relevant metric for runway planning.