Burn Multiple Calculator
See how much you burn for every dollar of new ARR.
BURN MULTIPLE
1.33x
Great
Burn multiple = net burn ÷ net new ARR. Under 1x is excellent; over 2x is inefficient.
What is Burn Multiple?
The burn multiple, popularized by David Sacks, measures how much cash you burn to generate each dollar of net new ARR. Lower is better — it's the clearest read on growth efficiency.
Burn multiple = net burn ÷ net new ARR
How to read your result
- Under 1x is excellent; 1–1.5x is great; 1.5–2x is okay; over 2x is inefficient.
- It rewards efficient growth, not just fast growth.
- It gets more important the more capital you've raised.
- Read it alongside runway and the Rule of 40.
Frequently asked questions
What is a good burn multiple?
Below 1x is considered excellent, 1–1.5x is great, and above 2x suggests you're burning too much cash for the growth you're getting.
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