Burn Rate Optimization Forecaster
Find the month you hit break-even and the cash it takes to get there.
At 8% monthly growth you reach break-even in ~14 months, needing about $790,282 of cash to bridge the gap. Raising growth or margin, or trimming fixed burn, all pull that date forward.
Assumes fixed burn holds while revenue compounds. In reality some costs scale with growth, treat the break-even month as a best case.
About this calculator
"We'll grow into profitability" is a plan only if you can say when and how much cash it costs to get there. This forecaster grows your revenue against a fixed cost base month by month until gross profit finally covers burn, turning a vague growth assumption into a specific break-even month and a specific cash number you need to survive until you reach it.
How to use it
- Enter current monthly revenue and the monthly revenue growth rate you expect to sustain.
- Enter fixed monthly burn, costs that don't scale with revenue, like salaries, rent, and core tooling.
- Enter gross margin, the percentage of revenue left after direct costs of delivering it.
- Read months to break-even, the break-even revenue level, and the cumulative cash needed to bridge the gap until you get there.
Methodology
The model simulates month by month for up to 120 months. Each month, gross profit is revenue × gross margin, and net cash flow is gross profit minus fixed burn. Revenue compounds forward each month at your growth rate.
Break-even month is the first month where gross profit meets or exceeds fixed burn. Break-even revenue is simply fixed burn ÷ gross margin, the revenue level at which gross profit exactly covers costs.
Cumulative cash flow is tracked across every month leading up to break-even, and the cash needed to get there is the size of the deepest cumulative deficit before the business turns cash-flow positive.
Fixed burn is held constant throughout the simulation, in reality some costs, headcount especially, scale with growth, so treat the break-even month and cash figure as a best-case estimate, not a guaranteed floor.
FAQ
It means the simulation ran the full 120-month window without gross profit ever catching up to fixed burn at the growth rate entered. That's a signal the growth rate is too low relative to fixed costs to reach break-even on any reasonable timeline, something on the cost, margin, or growth side needs to change.
To isolate the effect of revenue growth and margin on the break-even timeline cleanly. In practice, growing revenue often requires adding headcount or infrastructure that raises fixed burn too, which pushes break-even further out than this simplified model shows, treat this as an optimistic baseline.
It depends on your starting point, but cutting fixed burn has an immediate effect (it directly lowers the break-even revenue threshold), while raising growth rate compounds over time but takes longer to show up. Try adjusting each input separately in the tool to see which one moves your specific break-even month the most.
No, this figure is the cumulative deficit specifically between now and break-even, assuming you hit the modeled growth rate exactly. Compare it against your actual cash in bank and current runway (see the Growth Runway Extension Simulator) to see whether you can realistically survive to the break-even point this model projects.