The months a business can operate with its cash if it spends more than it collects.
Runway = Caja ÷ (Pagos − Cobros)
What each letter means
- C: Cash available
- P: Monthly payments
- R: Monthly receipts
An example
With C = €30,000, P = €12,000, R = €7,000: Months of cash = 6 months.