Learn more about common financial (and startup) terms here. To learn more about Pilot, fill out the form below.
Your burn multiple is your net cash burned divided by your net new ARR in a given period. It’s a measure of capital efficiency, and you’d like to keep it as low as possible.
Note that this metric assumes that you’re a SaaS business, but the general principle is applicable for any high-growth company. The term was first coined in a post by David Sacks, where he provides the following rules of thumb about acceptable burn rates for venture-scale startups:
You can read his full post here. (It’s both short and good.)
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