Written and reviewed by FormulaCraft Team. Each formula on this page is run through our verification engine before publishing.
Last reviewed:
How to calculate monthly burn rate in Excel and Google Sheets
Topic:SaaS metricsExcel & Google Sheets
=AVERAGE(D2:D4)✓
Verified example
Computed by a real spreadsheet engine on the sample data below.
| Month | Cash In ($) | Cash Out ($) | Net Burn ($) |
| Jan | 80000 | 120000 | 40000 |
| Feb | 85000 | 125000 | 40000 |
| Mar | 90000 | 138000 | 48000 |
=AVERAGE(D2:D4)→42666.6666666667
Try it with your data
Edit the grid or formula, then run it through a real spreadsheet engine — no signup.
Sample data — click any cell to edit
Runs server-side · free · no signup
Step by step
- 1Create a table with columns: Month (A), Cash In / Revenue (B), Cash Out / Expenses (C), Net Burn (D).
- 2In column B, enter total cash received each month (revenue collected, not accrued).
- 3In column C, enter total cash paid out each month (payroll, rent, SaaS tools, ad spend, etc.).
- 4In column D, calculate net burn per month as =C2-B2 (positive means burning cash). Copy down for each month.
- 5In a summary cell, compute the 3-month average burn with =AVERAGE(D2:D4) for a smoothed run rate.
Tips
- Use a 3-month rolling average rather than a single month. One-off large payments (annual software licenses, equipment) distort a single-month figure.
- Distinguish gross burn (total cash out) from net burn (cash out minus revenue). Investors typically want both; gross burn shows operating cost structure independently of revenue.
- Update burn rate monthly and flag any month where net burn increases by more than 15% without a corresponding planned investment in growth.
Working on a sheet you inherited? Run the Auditor on the whole file first — it flags every #REF!, #N/A, broken column pattern, and inconsistent formula in seconds, free, no signup.
Frequently asked
What is the difference between gross burn and net burn?
Gross burn is total cash outflows with no offset. Net burn subtracts revenue received: Net Burn = Cash Out − Cash In. Net burn is the figure used to calculate runway.
Should I include one-time costs like fundraising expenses in burn rate?
Exclude truly one-time costs when presenting burn to investors for runway calculations. For internal cash management, include everything — you still need that cash.
How does burn rate differ from operating loss?
Operating loss is an accounting (accrual) figure. Burn rate is a cash concept — it reflects when cash actually moves, which is what determines runway.
More on SaaS metrics
See all →Reference
RANDARRAY
Spills a grid of random numbers with specified rows, columns, min, max, and integer/decimal options. Excel 365 and Google Sheets only.
How-toHow to calculate churn rate
Calculate monthly or annual customer churn rate as lost customers divided by starting customers, expressed as a percentage, in Excel and Google Sheets.
Error fixFix #####
Fix ##### in Excel — the column is too narrow to display the number or date. Widen the column or change the format to resolve it.
ReferenceARRAYTOTEXT
Converts an array or range into a single text string, with concise or strict formatting options.
How-toHow to calculate monthly recurring revenue (MRR)
Learn how to calculate MRR in Excel and Google Sheets using SUMIF to sum active subscription revenue by billing period, normalized to a monthly figure.
Error fixFix Array result
Array result was not expanded in Google Sheets means output cells are blocked. Clear adjacent cells or use a blank area.