Net burn rate: Net financial consumption of a startup

February 14, 2024

The net burn rate indicates how quickly a startup uses up its capital, taking revenue into account, and is therefore an indicator of the net expenditure rate over a certain period of time. This metric helps companies understand how long their existing funds will last before new capital is needed and contributes to financial sustainability planning. By analysing and optimising the net burn rate, startups can increase their financial efficiency, extend capital maturity and make strategic decisions to minimise the risk of underfunding.