Implied Cash Runway Calculator

✖Cash Balance refers to the amount of money that a company has available in its cash accounts at a specific point in time.ⓘ Cash Balance [CBal]			+10% -10%
✖Net Burn refers to the rate at which a company is using up its cash reserves over a specific period, typically on a monthly or quarterly basis.ⓘ Net Burn [NB]			+10% -10%

✖Implied Cash Runway provides insights into the company's financial health and the feasibility of its business model without the need for additional funding.ⓘ Implied Cash Runway [ICRun]

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Formula

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Implied Cash Runway

Formula

`"ICRun" = "CBal"/"NB"`

Example

`"1.142857"="80000"/"70000"`

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Implied Cash Runway Solution

STEP 0: Pre-Calculation Summary

Formula Used

Implied Cash Runway = Cash Balance/Net Burn
ICRun = CBal/NB
This formula uses 3 Variables

Variables Used

Implied Cash Runway - Implied Cash Runway provides insights into the company's financial health and the feasibility of its business model without the need for additional funding.
Cash Balance - Cash Balance refers to the amount of money that a company has available in its cash accounts at a specific point in time.
Net Burn - Net Burn refers to the rate at which a company is using up its cash reserves over a specific period, typically on a monthly or quarterly basis.

STEP 1: Convert Input(s) to Base Unit

Cash Balance: 80000 --> No Conversion Required
Net Burn: 70000 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

ICRun = CBal/NB --> 80000/70000

Evaluating ... ...

ICRun = 1.14285714285714

STEP 3: Convert Result to Output's Unit

1.14285714285714 --> No Conversion Required

FINAL ANSWER

1.14285714285714 ≈ 1.142857 <-- Implied Cash Runway

(Calculation completed in 00.004 seconds)

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Credits

Created by Vishnu K

BMS College of Engineering (BMSCE), Bangalore

Vishnu K has created this Calculator and 200+ more calculators!

Verified by Kashish Arora

Satyawati College (DU), New Delhi

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< 9 Cash Management Calculators

Merton Model

Go Distance to the Default = ln(Market Value of Company Assets/Market Value of Company Debt)+((Risk Free Interest Rate+(Volatility of Company Asset Value)^2/2)*Time to Maturity)/(Volatility of Company Asset Value*sqrt(Time to Maturity))

Baumol's Model

Go Cost of Providing a Service = sqrt((2*Cost of Conversion*Total Requirement of Cash)/Interest Rate)

Cash Conversion Cycle

Go Cash Conversion Cycle = Days Inventory Outstanding+Days Sales Outstanding-Days Payables Outstanding

Miller Orr Model

Go Miller Orr Model = 3*((3*Cost of Conversion*Variance)/(4*Interest Rate/360))^(1/3)

Cash Surrender Value

Go Cash Surrender Value = mod(Enhanced Accumulated Value,Surrender Charges)

Cash Coverage

Go Cash Coverage = Earnings before Interest and Taxes/Interest Expense

Cash Burn Rate

Go Net Burn = Total Monthly Cash Sales-Total Monthly Cash Expenses

Implied Cash Runway

Go Implied Cash Runway = Cash Balance/Net Burn

Cash Budget

Go Cash Budget = Total Receipts-Total Payments

Implied Cash Runway Formula

Implied Cash Runway = Cash Balance/Net Burn
ICRun = CBal/NB

What is Implied Cash Runway?

Implied cash runway refers to the estimated length of time a company can continue its operations before exhausting its available cash reserves, based on its current cash burn rate. It is a forward-looking financial metric that helps stakeholders, such as investors, lenders, and management, assess the company's financial sustainability and plan for future funding needs.
To calculate the implied runway, divide the company's available cash reserves by its cash burn rate. The result represents the number of months or years the company can continue its operations without additional funding, assuming the cash burn rate remains constant.
For example, if a company has $1 million in cash reserves and its cash burn rate is $100,000 per month, the implied runway would be 10 months ($1,000,000 / $100,000 = 10). This means the company can sustain its operations for approximately 10 months before running out of cash.

How to Calculate Implied Cash Runway?

Implied Cash Runway calculator uses Implied Cash Runway = Cash Balance/Net Burn to calculate the Implied Cash Runway, The Implied Cash Runway formula is a financial metric used to estimate the length of time a company can sustain its operations based on its current cash burn rate and available cash reserves. Implied Cash Runway is denoted by ICRun symbol.

How to calculate Implied Cash Runway using this online calculator? To use this online calculator for Implied Cash Runway, enter Cash Balance (CBal) & Net Burn (NB) and hit the calculate button. Here is how the Implied Cash Runway calculation can be explained with given input values -> 1.142857 = 80000/70000.

FAQ

What is Implied Cash Runway?

The Implied Cash Runway formula is a financial metric used to estimate the length of time a company can sustain its operations based on its current cash burn rate and available cash reserves and is represented as ICRun = CBal/NB or Implied Cash Runway = Cash Balance/Net Burn. Cash Balance refers to the amount of money that a company has available in its cash accounts at a specific point in time & Net Burn refers to the rate at which a company is using up its cash reserves over a specific period, typically on a monthly or quarterly basis.

How to calculate Implied Cash Runway?

The Implied Cash Runway formula is a financial metric used to estimate the length of time a company can sustain its operations based on its current cash burn rate and available cash reserves is calculated using Implied Cash Runway = Cash Balance/Net Burn. To calculate Implied Cash Runway, you need Cash Balance (CBal) & Net Burn (NB). With our tool, you need to enter the respective value for Cash Balance & Net Burn and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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