Burn Rate

Burn rate is how quickly a business is spending its cash reserves, usually measured as an amount per month. A company not yet making a profit is burning through the money it raised, and the burn rate says how fast that pile is shrinking.

It is like how quickly a campfire eats through its woodpile: the faster it burns, the sooner you need more wood. Burn rate matters because, together with the cash in the bank, it decides a business's runway, and a rising burn rate without rising income is an early warning worth heeding.