Runway looks like one number, but the way most founders compute it hides the month things actually get tight. Here is the version that holds up.
Runway is the number of months your company can keep operating before it runs out of cash. It sounds simple, and that is the problem. The simple version, cash divided by last month's spend, is usually wrong in the direction that hurts, because it treats an unusual month as the rule and ignores the money you have already committed.
Your runway starts from cash you can actually spend. That means bank and cash balances, plus money sitting in a payment processor that will settle to you. It does not mean credit available on a card, and it does not mean invoices you hope to collect. Count what is liquid and yours.
Burn is money out minus money in. Net burn is the figure that matters, because revenue offsets spend. Average it across the last three completed months rather than reading a single month, which smooths out the quarter you prepaid annual software or the month a big invoice landed.
One expensive month is a data point, not a trend. Average before you panic or celebrate.
The average gives you a baseline. Real runway also respects the things on the calendar: a tax payment, an annual renewal, a hire starting next month, an invoice due to be collected. A forecast that starts from the run-rate and then layers in these known events is far more useful than a single division.
Take liquid cash. Divide by average net burn over three months. Then look forward and mark the weeks where a known inflow or outflow moves the line. The week your projected balance first crosses zero is your real runway, and it is almost never the clean number the simple formula gives you.
Finawo computes this for you from connected accounts, so the number updates itself every time money moves.
Finawo keeps runway, burn, budgets and a 13-week forecast live from your connected accounts.