Glossary / Burn Rate
Burn rate refers to the rate at which a company is spending its available cash or capital. It is typically measured on a monthly basis and is used to assess how quickly a company is using up its financial resources. A high burn rate indicates that a company is spending money at a rapid pace and may need additional funding to sustain its operations. On the other hand, a low burn rate suggests that a company is spending money at a slower pace and may have a longer runway before it runs out of cash. Burn rate is often used by investors and stakeholders to evaluate the financial health and sustainability of a company.