Startups · Expenses

What is an acceptable burn rate for a Series A venture?

Amit Verma na at na

September 21st, 2016

Particularly interested in knowing what this burn rate would be for a SaaS business that just raised a Series A round of financing.
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Peter Baltaxe Consultant, product leader, serial entrepreneur

September 21st, 2016

You need the money to last at least 12, ideally 18 months or more.  It also has to last long enough for you to hit the big milestones that you need to get your Series B.  There are almost always more expenditures than expected, so I recommend you be conservative in your burn rate.

Ramesh

September 21st, 2016

In spite of what stage your startup is in, your burn rate (monthly expenditure for pre-revenue company) should allow you to run your startup until you successfully raise next round of funding.
E.g. You raised $1M and and your average expense is $50k per month, then you only have 20 months runway before you run out of cash.

Shrinath Acharya CEO at Excelfore

September 21st, 2016

... depends on your expectation of the funding climate then (which will depend on your meeting your milestones, the fund raising appetite in your sector at that time, and the macro economy)

Joe Albano, PhD Using the business of entrepreneurialism to turn ideas into products and products into sustainable businesses.

September 21st, 2016

Are you saying that you have closed your A round? If so, did you set expectations with your investors?  

Jim Jordan Investor / Board Member at Sparx Hockey

September 21st, 2016

Depends on what stage you are at.  Do you have a GA product and starting to grow client base or are you still in core development.

Shams Juma

September 21st, 2016

12 to 18 months.