The Runway Conversation You Should Have With Yourself Every 90 Days

Most founders check their bank balance. Far fewer do the actual calculation that tells them what that balance means.

Runway is not your bank balance. It is how many months you have before the business runs out of money, given everything you know right now about what is coming in and what is going out. Those are two very different numbers, and confusing them is one of the more common ways a business gets into trouble quietly.

This conversation takes about thirty minutes. You should have it with yourself every 90 days, or whenever something significant changes.

Step 1: Get the Real Cash Number

Not your accounting balance. Your actual operating cash. That means:

• Your checking account balance today
• Minus any checks written but not yet cleared
• Minus any bills due in the next 30 days that you have not yet paid
• Plus any receivables you are genuinely confident will be paid in the next 30 days

Most owners are optimistic here. Be conservative.

Step 2: Calculate Your Current Burn Rate

Burn rate is what you spend per month when revenue is zero. Add up your fixed monthly obligations: payroll, rent, software subscriptions, debt service, minimum contractor commitments.

A separate number worth knowing is your net burn: what you actually spend minus what you actually collect, averaged over the last three months. If your fixed burn is $18,000 per month and you are collecting $12,000 per month in recurring revenue, your net burn is $6,000 per month. That is the number that matters for the runway calculation.

Step 3: Do the Math

Runway in months = operating cash divided by net burn.

If you have $72,000 in operating cash and net burn of $6,000 per month, you have 12 months of runway. If you have $24,000 and net burn of $8,000, you have three months. That is not a planning conversation — that is an emergency.

Step 4: Stress Test It

Ask two questions:

What happens if my biggest revenue source drops by 30% next month? Recalculate runway with that assumption.

What happens if my next planned hire goes in on schedule? Many founders are shocked to discover a hire planned for month four triggers a cash problem by month six.

These are not worst-case scenarios. They are moderately bad ones. Your plan should survive moderately bad.

Step 5: Decide What the Number Means

• 12+ months: Room to execute without pressure. Use the window intentionally.
• 6 to 12 months: Normal operating range. Progress on revenue drivers needs to be visible.
• 3 to 6 months: Decision window, not a planning window. Something needs to change.
• Under 3 months: Stop planning. Execute on the one move that changes the number.

Why 90 Days

If you do this calculation in January and next check in June, you will have missed three months of drift. By June, decisions that were easy in March are now urgent. Ninety days is short enough to catch drift before it compounds.

The Most Honest Question to End With

After you do the math, ask yourself: do I believe this number? Not do I like it. Do I believe it?

If your calculation shows 14 months of runway but your gut says something feels off, go back and find the assumption that is doing too much work. Find it. Update the number. Then act on what is actually true.