How To Calculate Runway in Timberline | Arithmix

Calculating runway is an important task for any business owner or entrepreneur. It helps you determine how long your company can sustain its operations without running out of cash. In simple terms, runway is the amount of time your business can survive with the cash it currently has. It is a crucial metric that can help you make important decisions about your business's future.

What Is Runway?

Runway is a financial metric that calculates the amount of time a company can continue to operate with its current cash balance. It is calculated by dividing the current cash balance by the monthly burn rate. The burn rate is the amount of money a company spends each month to cover its expenses. By calculating the runway, you can determine how long your business can survive without additional funding.

For example, if your business has $100,000 in cash and your monthly burn rate is $10,000, your runway would be 10 months. This means that your business can continue to operate for 10 months without additional funding.

When Is It Valuable To Calculate Runway?

Calculating runway is valuable for any business, but it is especially important for startups and small businesses that are just starting out. These businesses often have limited cash reserves and need to carefully manage their finances to ensure their survival.

Calculating runway can help you make important decisions about your business's future. For example, if your runway is short, you may need to consider raising additional funding or cutting expenses to extend your runway. On the other hand, if your runway is long, you may have more flexibility to invest in growth opportunities or take calculated risks.

Overall, calculating runway is an essential task for any business owner or entrepreneur. It can help you make informed decisions about your business's finances and ensure its long-term success.

How Do You Calculate Runway in Timberline

Timberline itself isn't naturally geared towards letting you calculate complex metrics like Runway. As an alternative, teams typically use products like Arithmix to import data from Timberline and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that's powerful yet easy to use. With Arithmix you can import data from systems like Timberline, combine it with data from other systems, and create calculations like Runway.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating Runway in Arithmix

Calculating metrics like Runway is simple in Arithmix. Once you've created your free account, you'll be able to import your Timberline data, and use it to create natural language formulas for metrics like Runway.

Arithmix is designed to give you the power to build any calculations you want on top of your Timberline data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.