How do I calculate cash runway?

Runway is cash on hand divided by net monthly burn, where net burn is monthly expenses minus monthly revenue. AED 600,000 in cash against a AED 50,000 monthly burn gives 12 months of runway.

What is a healthy amount of runway?

Most investors expect 12 to 18 months. Below six months, fundraising or cost reduction usually has to start immediately, because raising takes longer than founders expect.

Cash Flow Runway Calculator

Summary Response

"Runway is cash on hand divided by net monthly burn, where net burn is monthly expenses minus monthly revenue. A company with AED 600,000 in the bank, AED 20,000 of revenue and AED 70,000 of expenses burns AED 50,000 a month and has 12 months of runway."

UAE Cash Flow Factors

Annual licence renewal and rent cheques create lumpy outflows that a flat monthly burn figure hides: model them separately.

End-of-service gratuity accrues as a real liability from year one even though it is only paid on exit; a runway that ignores it overstates your position.

Payment terms of 60-90 days are common in the UAE, so revenue booked is not revenue banked.

Frequently Asked Questions

Want This Reviewed by an Advisor?

These figures are an estimate. Our partner accountants and tax agents in the UAE can confirm your position and file on your behalf.

[ Talk to a UAE Tax Advisor ]