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Cash Runway Scenario Analysis Template

Base, downside and upside runway models built from your own history, with a cash floor and the last month to make each decision in time.

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Pack of 9 files: 3 documents, 6 spreadsheets

Cash Runway Scenario Analysis Template
  • Scenario AssumptionsDocument
  • Trigger and Decision NoteDocument
  • Runway SlideDocument
  • Base ModelSpreadsheet
  • Downside ModelSpreadsheet
  • Upside ModelSpreadsheet
  • Burn HistorySpreadsheet
  • Trigger DashboardSpreadsheet
  • Decision RegisterSpreadsheet
RiverCash Runway Scenario Analysis Template

Trigger Dashboard

[Entity] — at 30 September 2026

16.5 months of runway. The last month the round can be authorized is February.

Cash11,850,000Trailing 6-month net outflow718,845
Covenant minimum, at all times1,000,000Quoted runway16.5 mo
Measured intra-month trough660,000Usable runway14.2 mo
Cash floor1,660,000Usable cash10,190,000

Three cases, each ending in a date

CaseSystems revenueCash reaches the floor
Upside, best observed quarter1.23 of trendnot inside 24 months
Base, trend through 24 actualstrendJanuary 2028
Downside, worst observed quarter0.57 of trendOctober 2027

Triggers, armed, in date order

 DecisionAuthorize byDaysBuys
T-1Raise the Series B28 Feb 2027151all of it
T-2Reduce nine roles31 Jul 20273043 months
T-4Stop the tooling programme31 Aug 20273353 months
T-5Open a receivables facility31 Jul 20273040 months
T-3Draw the remaining facility30 Sep 20273651 month

Each date is solved backwards from the October 2027 floor through that decision's own lead time and its own up-front cash cost. The convention everyone uses, act when runway falls under six months, does not fire until May 2027. That is three months after T-1 stopped being executable, because a runway number does not know how long a fix takes.

Page 1 of 1221 words

How to run a cash runway scenario analysis

A cash runway scenario analysis shows how long your cash lasts in a base, downside and upside case. A good one also shows the last month to make each decision, such as raising money or cutting costs, in time to work. To build one, calculate net burn from your bank or ledger history and set a floor for the cash you must always keep. Then project each case month by month until cash reaches the floor, and count back through each decision's lead time.

Lead times matter more than the month count. A raise that takes eight months must start eight months before cash reaches the floor, whatever the runway number says.

Two men in business clothes talk at a cafe table with a laptop, coffee cups and a printed chart
Settle the decide-by dates while every option is still open. Photo: Vitaly Gariev on Unsplash

Calculate cash runway from actual burn

Start with net burn: the cash that leaves each month minus the cash that comes in. Take it from bank statements or the ledger, not the budget, and average the last six months. The venture capitalist Fred Wilson warns that one-time expenses arriving every month or two aren't really one-time1, and that assuming a constant burn rate can be very dangerous.

Simple runway is cash divided by net burn. The template's example, a made-up robotics company, holds $11.85 million and burns $718,845 a month: 16.5 months. That assumes every dollar can be spent.

Set the floor before you count months

Runway ends at the lowest balance you can safely hold, not at zero. Start with any minimum cash or liquidity covenant in your loan agreements, and check how it's tested. A minimum tested at all times is breached the day the balance dips below it, even if every month-end looks fine. With no loan, use one payroll cycle plus the bills you can't defer.

Then measure how far your balance falls inside a month. For each of the last 12 months, subtract the lowest daily balance from the month-end balance, and keep the largest gap. Payroll often clears before the biggest customer payment lands.

Add the two to get the floor. In the example, a $1 million loan minimum plus a $660,000 dip makes a floor of $1.66 million. That leaves $10.19 million to spend: 14.2 months at the same burn, not 16.5.

Build three cases from your own history

Take the downside and upside from your own history, not a chosen percentage such as 20% either way. Fit an exponential trend line through 18 to 24 months of one-off sales, keeping recurring revenue separate. Divide actual sales in every rolling three-month window by the trend's figure for those months. The lowest ratio is your downside and the highest is your upside.

In the example, the worst window ran 42.8% below trend and the best 23.3% above. A 20% downside would capture less than half of a fall the company already lived through.

Change only one-off sales between the cases, and keep the hiring plan and committed spending in all three. The venture firm Sequoia Capital told the founders it backs in March 2020 that in downturns, revenue and cash levels always fall faster than expenses2. Recurring revenue under contract keeps its balance in a downside and just grows more slowly. Purchase orders you've already placed must still be paid.

End each case at its floor date: the month cash first falls below the floor.

Three cases in the template's example

CaseOne-off sales against trendFloor date
Upside1.23 times, the best windowNot within 24 months
BaseOn trendJanuary 2028
Downside0.57 times, the worst windowOctober 2027

Simple runway of 16.5 months points to mid-February 2028, later than both dates.

List every option and its lead time

List every decision that could push the floor date out. FASB, which sets US accounting standards, offers a starting list in its going-concern standard. Its four example plans are disposing of an asset or business, borrowing money or restructuring debt, reducing or delaying expenditures, and increasing ownership equity3.

Give each one four numbers: lead time to first cash, up-front cost, monthly effect once it lands, and any one-off inflow. Measure a raise's lead time on your own last round, from preparing the data room to money in the bank.

Cuts have lead times and up-front costs too. In the US, the WARN Act requires employers with 100 or more employees to give at least 60 calendar days' written notice of a plant closing or mass layoff4. It generally covers cuts affecting 50 or more employees at one site, and some states have their own laws.

Price severance from your own policy and offer letters, not a rule of thumb. The cost reduction plan tool dates each cut from the contract or law behind it.

Four options in the template's example

OptionLead timeUp-front cashCash effectIf decided now
Raise a Series B8 months$185,000$12 millionNo floor date within 24 months
Cut nine roles1 month$412,000Saves $214,000 a month3 more months
Draw the rest of a loan1 month$20,000$2 million, then $52,178 a month in repayments1 more month
Open a receivables line2 months$35,000$640,000, then $12,160 a month in interestNo extra time

The loan draw buys one month: repayments start the next month, and the loan's minimum still applies.

Count back to a decide-by date

Run the downside case with each decision approved in each future month in turn, paying its up-front cost at once and getting its cash after the lead time. The last month that keeps cash above the floor until that cash arrives is the decide-by date (the template's authorize-by date).

Pair each date with an early warning, such as signed orders for the next 90 days falling below a set level, and act on whichever comes first.

Fred Wilson advises raising again at least six months before you run out of cash1. Treat that as a minimum, not a trigger. In the example, downside runway first dips under six months in May 2027, three months after the Series B's decide-by date.

Paul Graham calls this trap the fatal pinch5: a slow-growing, money-losing startup with, say, six months of runway, counting on raising more. His advice is to write down precisely what you'll do if you can't raise6, and precisely when you'll switch to it.

ExampleOne cut, decided in four different monthsAn illustrative example written for this guide, from the template's made-up company.

Cutting nine roles costs $412,000 up front and saves $214,000 a month from the month after. With no action, the floor date is October 2027.

Decided in October 2026: January 2028, three months later.

Decided in February 2027: December 2027, two months later.

Decided in May 2027: November 2027, one month later.

Decided in August 2027: September 2027, a month earlier than doing nothing.

  • Late can be worse than never. In August, severance leaves before any saving arrives.

Refresh the dates after every close

After each monthly close, add the month to your history, recheck the floor and your worst window, and redo every date. Note which dates moved: a new worst window moves them all earlier at once.

Put the same cases and dates in your board deck, monthly investor update and monthly management report, so nobody hears two versions of your runway.

When to call a lawyer or accountant

Have a lawyer confirm how your loan defines cash and tests its minimum, and review any layoff plan. Under US GAAP, management must assess whether the company can continue as a going concern for one year after its financial statements are issued3, so involve your accountant early.

Before you share it

  • The floor shows its two parts, with usable cash beside it
  • Burn comes from actual months, not the budget
  • The downside and upside come from your worst and best three-month windows
  • Every option has a lead time, an up-front cost and a decide-by date
  • The earliest decide-by date comes first, with the days left

For the next few weeks, keep a 13-week cash flow forecast alongside this model. To skip the setup, open this template in River with your ledger and loan agreements.

How to use this template

Use the files as they are, or open them in River. Send River 18 to 24 months of ledger or bank history, your loan agreements and the hiring plan. It sets the floor first, finds your worst and best three-month windows against trend, and builds the three cases. Then it works out when each decision is due and leads with the earliest.

River asks for your last round's actual timeline and your real severance terms rather than using benchmarks. If a number is missing, it marks a placeholder and tells you what would replace it, instead of inventing a covenant or a lead time.

  1. Download it or open it in River

    Get the three Word documents and six CSV sheets free, or open the template in River and send it your ledger.

  2. Set the floor first

    Add your loan's cash minimum to your largest dip within a month, or let River find both in your loan agreements and bank statements.

  3. Build the cases and options

    Fill the three models from your own revenue history, then list every option with its lead time and up-front cost.

  4. Date each decision, then refresh

    Work out each decide-by date, share the runway slide, and update every date after each monthly close.

What's in the template

A month count, and then the four things it hidesFive decisions with solved dates, the raise against the convention, the same reduction in four months, and the downside measured rather than assumed.
Cash Runway Scenario Analysis Template
RiverThe number

Why 16.5 months is not an answer

Marchetti Robotics, Inc. Forty-six people, warehouse robotics, 24 months of ledger actuals to 30 September 2026. An illustrative company.

Cash at 30 September 202611,850,000
Trailing six-month average net operating outflow718,845
Cash divided by that outflow16.5 months

What the quotient contains

 AmountWhere it comes from
Covenant minimum1,000,000Unrestricted cash at all times, equipment facility
Intra-month trough allowance660,000Largest measured month-end to intra-month-low gap, 12 months
Cash floor1,660,000The balance the company actually stops at
Usable cash10,190,0002.3 months of the 16.5 cannot be spent

A month-end balance sitting exactly on a covenant minimum is a breach on the fifteenth, because payroll cleared and the month's largest receipt had not landed. That is what the second row is for, and it is measured from statements rather than estimated.

Three cases, and the dates they produce

CaseBasisFactorFloor date
UpsideBest rolling three months in 24 actuals, Oct to Dec 20251.2333outside 24 months
BaseLog-linear trend through 24 actuals, 2.46% a month1.0000January 2028
DownsideWorst rolling three months in 24 actuals, Jan to Mar 20260.5716October 2027

The quoted 16.5 months lands in mid February 2028, one month past the base case. The floor and the plan's own cost ramp roughly cancel there, which is exactly why the quotient looks harmless.

The triggers are solved against October 2027, not against the base case and not against the quotient. A case nobody would be embarrassed to have used is the one that has already happened once.

RiverAuthorize by

Decision Register

Every decision that could move the floor date, with the four properties that set its authorize-by month. Floor date with no action: October 2027.

 DecisionUp-front cashLeadMonthly effectOne-off in
D-1Raise the Series B185,0008 mo—12,000,000
D-2Reduce nine roles412,0001 mo214,000—
D-3Draw the remaining facility20,0001 mo(52,178)2,000,000
D-4Stop the tooling programme96,0001 mo165,000—
D-5Open a receivables facility35,0002 mo(12,160)640,000

Solved dates

 Authorize byDays leftFloor date if authorized nowBuys
D-128 Feb 2027151outside the horizonall of it
D-231 Jul 2027304January 20283 months
D-431 Aug 2027335January 20283 months
D-330 Sep 2027365November 20271 month
D-531 Jul 2027304October 20270 months

Two million dollars buys one month. By the October 2027 floor date, D-3 has produced 2,000,000 and paid back 626,136 of amortisation plus a 20,000 fee. Drawing does not lower the floor either: the covenant tests unrestricted cash at all times, so the 1,000,000 minimum stands over a larger balance sheet. D-5 adds 459,080 of net cash and no months at all, because the month it would have to bridge needs more than a million.

Both of those get counted as runway in conversation. The register is where a source gets priced instead of asserted.

The two cheap ones, together

D-2 and D-4 authorizedFloor dateAdded
October 2026September 202811 months
February 2027April 20286 months
May 2027, when the convention firesJanuary 20283 months
September 2027September 2027a month earlier
RiverThe raise

D-1, and the eight months nobody budgets

Raise the Series B · 12,000,000 · authorize by 28 February 2027

The lead time is measured on this company's own Series A, not taken from an article.

StageWeeksCumulative
Model and data room into shape66
First partner meeting to signed term sheet1925
Term sheet to wire934
Authorize to cash348 months

Two ways to decide when to start

 FiresWire arrivesFloor breaksResult
Runway falls under six monthsMay 2027January 2028October 2027Closes three months too late
Authorize-by, solved backwardsFebruary 2027October 2027October 2027Closes in time

On the downside path the runway number first prints under six at 5.99 months in May 2027. It is arithmetically correct and it is three months too late, because a quotient of cash over burn has no term for how long a fix takes.

The condition that can pull the date earlier

Signed systems orders scheduled to ship inside 90 days2,284,000
Base plan for the same quarter2,161,000
Coverage1.06
Threshold that trips T-1 earlybelow 1,800,000

A trigger is a date and a condition, whichever arrives first. Below 1,800,000 the downside case is arriving rather than being modelled, and February stops being the answer.

RiverWaiting

D-2, and what waiting costs

Nine roles · 412,000 up front · 214,000 a month from the following month

Same nine roles. Same monthly saving. Four different months.

AuthorizedHeadroom in the month of actionFloor dateMonths bought
October 20269,029,616January 20283
February 20275,583,616December 20272
May 2027, when the convention fires3,036,096November 20271
August 2027549,489September 2027a month earlier

The last row is the whole argument. Authorized in August, the 412,000 of severance, accrued time off and employer payroll taxes leaves before any saving arrives, and the floor breaks in September rather than October. The decision does not lose value gradually. It turns negative.

Why its date is 31 July 2027

Last month the reduction still holds the floor through its own landing monthJuly 2027
Week 25 of D-1's schedule, when a term sheet should existJuly 2027

The two land in the same month by construction, which makes the condition on T-2 obvious: no signed term sheet by 31 July. That is the month the answer on the raise is known and the fallback is still worth taking.

Holding a decision in reserve is free only while its authorize-by date is still in front of you. The register turns that into a number per decision instead of a feeling, which is the point of writing it down before anybody needs it.

RiverDownside

How the downside was measured

Not a percentage. Every rolling three-month window in 24 actuals, measured against the company's own fitted trend.

WindowActualTrendRatio
Jan to Mar 2026, the worst of 22821,0001,436,4020.5716
Oct to Dec 2025, the best of 221,647,0001,335,4041.2333

History is not symmetric

Measured downside42.8% below trend
Measured upside23.3% above trend
A plus or minus 20 percent case, on the downside2.14x too mild
The same case, on the upside1.17x too mild

Two errors pointing in opposite directions inside one model. The worst window was a supply slip on two subassemblies, and it is inside the trailing twelve months, so it is not an old event the company has grown out of.

Two lines a haircut gets wrong

Recurring revenue keeps its balance. It has not fallen in any of the 24 months, because it is contracted. What a downside removes is the growth. Measured: recurring revenue rose 151,000 over the trailing twelve months against 5,716,000 of systems shipped in the twelve months ending two months earlier, so 26,417 of monthly recurring per 1,000,000 shipped. The downside grows at 57 percent of the base rate rather than losing its base.

Committed purchase orders are already spent. Materials are bought two months ahead on 30-day terms, so November and December shipments are paid for whatever happens.

Month of cashCommittedWhat a flexed model shows
October 2026423,354241,989
November 2026432,456247,192
Cash a flexed downside hands back366,628

A model that flexes cost of revenue with revenue makes a shipment slip look cheaper than it is, which is the one direction a downside case must never be wrong in.

  • Scenario AssumptionsWhere every figure comes from: the floor, burn, how each case was set, and what no case includes.
  • Trigger and Decision NoteOne record per decision: the arithmetic behind its decide-by date, its warning condition and the cost of waiting.
  • Runway SlideOne slide with speaker notes, built from the sheets, so the board and investors see the same dates.
  • Burn History sheetTwo years of actual cash by line, each rolling three-month window against trend, and quoted versus usable runway.
  • Base Model sheetTwo years of monthly cash on your revenue trend, ending in the month cash reaches the floor.
  • Downside Model sheetThe same two years with revenue at your worst three-month window's ratio to trend, and committed purchase orders held.
  • Upside Model sheetThe same two years at your best three-month window's ratio to trend, with costs left on plan.
  • Decision Register sheetEvery option with its lead time, up-front cash, monthly effect, one-off inflow and decide-by date.
  • Trigger Dashboard sheetEach trigger's decide-by date, days left, warning condition, current reading and status, on one page.

Common questions

How do you calculate cash runway?

Divide your cash balance by your average monthly net burn: $1.2 million at $100,000 a month is 12 months. For a truer figure, first subtract the cash you must keep, such as a loan's minimum balance. Take burn from several recent months of actual cash flow, not the budget. Treat the result as a starting point until you add scenarios and lead times.

What should a cash runway scenario analysis include?

A cash floor, three cases and a dated list of decisions. Show the cash you must keep and why, then base, downside and upside cases built from your own revenue history, each ending in the month cash reaches the floor. Finish with every option's lead time, cost and decide-by date, earliest first.

How much runway should a startup have?

Enough to cover your slowest fix with time to spare. Fred Wilson, a venture capitalist since 1986, advises raising again at least six months before cash runs out, but your own lead time matters more. If your last round took eight months from preparation to money in the bank, start more than eight months before your floor date.

What is the difference between gross burn and net burn?

Gross burn is all the cash you pay out in a month: payroll, suppliers, rent, loan payments and equipment. Net burn is gross burn minus the cash that comes in, mostly customer payments. Runway uses net burn, because that is how fast your bank balance actually falls.

Who needs a cash runway scenario analysis?

Any company spending more cash than it brings in, especially a startup between rounds or a business with loan covenants. Boards use it to approve a raise or cuts in time. Investors ask too: Sequoia Capital's March 2020 memo asked the founders it backs whether they had as much runway as they thought. Fund managers then report on each company in their quarterly LP letter.

Is this cash runway template free?

Yes. Download the three Word documents and six CSV sheets with no signup. They come filled in for a made-up robotics company, so you can see how each sheet works before you replace the numbers with yours. Edit with AI opens the same template in a free River workspace.

What does Edit with AI do?

It opens the template in a free River workspace and starts by setting your cash floor. River asks for 18 to 24 months of ledger or bank history, your loan agreements and the hiring plan. It then builds the three cases and works out each decision's date. It leads with the earliest date, and says so plainly if that date has already passed.

Sources

  1. AVC. “Burn Rate.” avc.com (opens in a new tab)

  2. Sequoia Capital. “Coronavirus: The Black Swan of 2020.” sequoiacap.com (opens in a new tab)

  3. FASB. “Accounting Standards Update No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” storage.fasb.org (opens in a new tab)

  4. U.S. Department of Labor. “Plant Closings and Layoffs.” dol.gov (opens in a new tab)

  5. Paul Graham. “The Fatal Pinch.” paulgraham.com (opens in a new tab)

  6. Paul Graham. “Default Alive or Default Dead?” paulgraham.com (opens in a new tab)

Written by

Chandler Supple

Co-founder & CEO, River

Chandler has spent the last six years working in AI, building tools for millions of users and Fortune 100 companies. In 2025, he co-founded River to build a new kind of operating system for AI agents.

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Reviewed by

Brian Joseff, Co-founder, River

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