Average startup burn rate by stage
Burn rate scales with stage — from a few thousand a month pre-seed to hundreds of thousands at Series A+. Learn typical ranges, the burn multiple, and calculate yours.
Burn rate is how much cash your company spends each month. It naturally grows as you hire and scale, but what matters is whether that burn is buying proportional progress — captured by the burn multiple.
Typical burn by stage
Burn varies enormously by market and team, but rough ranges look like this:
| Stage | Typical monthly net burn |
|---|---|
| Pre-seed | ~$5k–$50k |
| Seed | ~$50k–$150k |
| Series A | ~$150k–$500k |
| Series B+ | $500k+ |
The burn multiple
Coined by David Sacks, the burn multiple = net burn ÷ net new ARR. It tells you how much you burn to add a dollar of recurring revenue. Lower is better:
| Burn multiple | Rating |
|---|---|
| Under 1x | Amazing |
| 1–1.5x | Great |
| 1.5–2x | Good |
| 2–3x | Suspect |
| Over 3x | Bad |
Good vs bad burn
Burn that buys durable growth, retention and margin is good. Burn on channels that do not pay back, or headcount ahead of need, is bad. Track burn against milestones, not just the calendar.
Managing burn
- Tie hiring to revenue or clear milestones.
- Watch the burn multiple, not just the absolute number.
- Keep 18+ months of runway as you scale spend.
- Revisit cloud and tooling costs quarterly.
Quick runway check
Run the numbers on your own startup
Use the free Runway calculator — no signup, instant results.
Open the Runway CalculatorFrequently asked questions
What is a normal burn rate for a startup?
It scales with stage: roughly $5k–$50k/mo pre-seed, $50k–$150k at seed, and $150k–$500k+ at Series A. Capital-light SaaS teams sit at the lower end.
What is the burn multiple?
Net burn divided by net new ARR. Under 1x is amazing, 1–2x is good, and above 3x suggests inefficient growth. It measures how efficiently you convert cash into recurring revenue.
Is a high burn rate always bad?
No — what matters is what the burn buys. High burn that generates efficient, durable growth can be fine; high burn with little to show for it is the problem.