SaaS Burn vs Growth Calculator

Calculate your burn multiple, YoY ARR growth rate, and efficiency verdict — the two metrics VCs use to judge pre-profitability SaaS health in 2026.

Cash out − cash in (excluding VC investment)
New + expansion − churn − contraction this month
Total ARR at start of this month
Burn Multiple
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Dollars burned per dollar of net new ARR
YoY ARR Growth Rate
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Annualized Net New ARR
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Burn Efficiency
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Monthly Burn
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Monthly Net New ARR
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Projected ARR (12 mo)
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Ad Space

What Is SaaS Burn Multiple?

Burn multiple = monthly net cash burned / monthly net new ARR. It was coined by David Sacks (former PayPal COO, Yammer CEO) and is now a standard VC due diligence metric alongside the Rule of 40. Burn multiple tells you the efficiency of growth: how many dollars does the company spend to generate each dollar of new recurring revenue? A burn multiple below 1x means the company generates more ARR per month than it burns in cash — approaching capital efficiency. A multiple above 3x signals that growth is being bought with unsustainable cash spend and a fundraising cliff may be approaching. Bessemer Venture Partners published burn multiple benchmarks in their 2024 State of the Cloud report. Last updated: May 2026.

Why Burn Multiple and Growth Rate Must Be Analyzed Together

Burn multiple without growth rate context is incomplete. A 3x burn multiple at 200% YoY ARR growth is very different from 3x burn at 30% growth. The first is aggressive land-grab in a winner-take-most market; the second is a company declining toward insolvency. This calculator computes both simultaneously. The YoY growth rate here is an annualized projection based on your current monthly net new ARR pace versus current ARR — a leading indicator. Actual YoY requires comparing to exactly 12 months prior. The Rule of 40 provides a complementary check: growth rate % + profit margin % should exceed 40. Companies below Rule of 40 at Series B face valuation compression of 30–50% versus peers above 40.

How to Use This Calculator

Enter your monthly net burn — this is cash out (payroll, AWS, rent, marketing, etc.) minus cash in from operations (not VC raises, not one-time proceeds). Enter net new ARR for the same month: new logo ARR + expansion ARR − churned ARR − contraction ARR. Enter current ARR as of the start of the month. The calculator outputs burn multiple, annualized growth rate, projected ARR in 12 months at current pace, and a VC-grade verdict. Aim for burn multiple under 1.5x before your next funding round. If you are above 2x, identify the largest single cash consumer (usually payroll — headcount efficiency is the fastest lever) and model the impact of freezing or reducing that spend.