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The one metric that predicts if your startup will survive the next 12 months
💡 Burn rate and runway determine survival. Aim for 18+ months of runway and track when you'll become 'default alive.'
It's not revenue. It's not user growth. The single most important metric for early-stage survival is burn rate — how fast you're spending money each month.
Gross burn is total monthly spending. Net burn subtracts revenue: if you spend $100K/month and earn $30K, your net burn is $70K. Your runway is cash divided by net burn. With $700K in the bank and $70K net burn, you have 10 months to either grow revenue or raise more money.
VCs typically want to see 18+ months of runway after a round. The magic number? When your net burn turns negative (meaning revenue exceeds costs), you've reached default alive — you'll survive even if you never raise again. Paul Graham wrote that this is the single most important milestone for a startup.