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Cash burn

What is cash burn?

Cash burn refers to the rate at which a company spends its cash reserves, particularly common in startups that may not yet be profitable. It's an important measure of a company's financial health and sustainability.

Calculating a company's cash burn can provide insight into its operating efficiency and financial stability. A high burn rate may signal the need for additional capital or operational changes to ensure the company can continue its operations. Conversely, a low burn rate may indicate that a company is conserving cash and potentially well-positioned for long-term survival.

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