Gross Burn Rate
Total monthly operating expenses before accounting for any revenue — the total cash outflow per month.
What is Gross Burn Rate?
Gross burn rate is your total monthly spending regardless of revenue. It includes payroll, tool subscriptions, rent, marketing spend, contractor fees — everything that costs money.
Gross burn is useful for understanding your total cost structure and overhead. Even if you're generating significant revenue, knowing your gross burn tells you what it costs to keep the company running.
For early-stage startups with little or no revenue, gross burn and net burn are essentially the same number.
Why it matters
Gross burn tells you the absolute minimum your company needs to survive each month. If all revenue disappeared tomorrow, gross burn is what you'd be facing.
It's also the number to watch when planning fundraises — investors want to know your total cost structure, not just net burn, because it reveals how lean (or bloated) your operations are.
Formula
Gross Burn = Total Monthly Operating Expenses (payroll + tools + commitments + other)
Example
A startup pays $60,000 in salaries, $5,000 for SaaS tools, $3,000 for office space, and $7,000 for contractors. Gross burn = $75,000 per month.
How RunwayCal helps
RunwayCal shows both gross and net burn on your Mission Control dashboard. The expense composition breakdown separates payroll, tools, and commitments so you can see exactly what drives your total spending.
Common mistakes
- 1Forgetting annual subscriptions that translate to a monthly cost
- 2Not including contractor or freelancer costs in gross burn
- 3Treating one-time expenses as recurring when computing monthly gross burn
Break down your total monthly spend
RunwayCal separates your spending into payroll, tools, and commitments so you see exactly what drives your gross burn.
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