Burn rate, cash runway and staying alive

On 1 June 2026 Klasna has 3,786,298 UAH in the bank, a record. That is the normal shape of a seasonal year: families prepaid spring lessons, and summer will use them. The first question is how fast money leaves.

Gross burn is all the cash going out in a month: payment fees, tutor payouts, video and AI, salaries, office, marketing and equipment. It ignores what comes in.

June 2026, Hanna's forecast:

• fees 36,516.50 + tutor payouts 1,710,912 + video and AI 131,936;
• salaries 616,000 + office 84,000 + marketing 180,000;
• equipment 0.

Gross burn: 2,759,364.50 UAH.

Gross burn tells you how big the machine is: how much money must keep arriving every month just for Klasna to stand still. It does not tell you how fast the bank drains, because families still pay in June. Take every cash-out column of the month, and only cash-out columns: profit, lessons delivered and families' payments belong elsewhere.

Net burn is cash out minus cash in: the amount the bank balance actually shrinks by in a month. It equals the month's net cash flow with the sign flipped. When net cash flow is positive, there is no burn at all.

June 2026 at Klasna:

• cash out (gross burn): 2,759,364.50 UAH;
• cash in: families pay 1,460,660 for packages;
• net burn: 2,759,364.50 − 1,460,660 = 1,298,704.50 UAH.

Three numbers are easy to confuse with it:

• gross burn (2,759,364.50) forgets the money coming in;
• the operating loss (133,497.60) is a P&L number on an accrual basis;
• cash in (1,460,660) is only one side.

Gross burn tells you how big the machine is; net burn tells you how fast the tank drains. Hanna watches both: families' payments cover about half of June's cash out, and the other half comes from the spring balance.

Equipment is cash out like any other payment, so it belongs in burn for the month it is paid, even though the P&L will spread it as depreciation later.

August 2026 in Hanna's forecast:

• fees 22,656.25 + tutor payouts 1,215,448 + video and AI 93,496;
• salaries 616,000 + office 84,000 + marketing 210,000;
• equipment: laptops, 432,000.

Gross burn: 2,673,600.25 UAH. Cash in: families pay 906,250. Net burn: 1,767,350.25 UAH, which matches August's net cash flow of −1,767,350.25.

Compare the summer months: June 1,298,704.50, July 867,563, August 1,767,350.25. August is the heaviest month because the laptops land in it and families pay least just before the new season. Without the laptops, August's net burn would be 1,335,350.25.

When a burn number jumps, look for a one-off payment first. It may be a choice whose timing you can move, which is exactly the lever this lesson ends on.

Cash runway is how many months the cash lasts at the expected net burn:

runway = cash today ÷ average monthly net burn ahead

Klasna on 31 May 2026:

• cash: 3,786,298 UAH;
• forecast net burn: June 1,298,704.50 + July 867,563 + August 1,767,350.25 = 3,933,617.75, laptops included;
• average: 3,933,617.75 ÷ 3 = 1,311,205.92 a month;
• runway: 3,786,298 ÷ 1,311,205.92 = 2.89 months.

September, when families start prepaying again, is three months away. So on average Klasna does not quite get there.

Why not use May's burn? In May the bank fell by only 579,217.50, which would give a runway of about 6.5 months. Runway looks ahead: summer is different, families pay far less, and the laptops land in August. Use the burn you expect, not last month's. A runway based on a good month is the most comforting and the most wrong number in the room.

Leo's own spreadsheet says Klasna spends 2.76 million a month, so the cash lasts a month and a half. That is gross burn in the runway formula, and it is wrong for runway.

The bank balance shrinks by net burn, because families keep paying for packages all summer. With gross burn:

3,786,298 ÷ 2,759,364.50 ≈ 1.37 months: panic.

With net burn:

3,786,298 ÷ 1,311,205.92 ≈ 2.89 months: tight, but a different conversation.

Gross burn is not useless. Hanna still watches it, because it shows how much cash must keep arriving each month just to stand still: if families' payments dropped sharply, net burn would climb towards gross burn. But runway is about how long the money lasts, and that depends on money out minus money in.

Rule of thumb: runway always uses net burn; gross burn describes the size of the business and its dependence on incoming payments.

Runway as cash ÷ average burn assumes the burn is the same every month. For a seasonal business it rarely is, and the order of the months matters.

Klasna's summer forecast, closing cash month by month:

The heaviest month comes last, so the balance goes below zero at the very end of the summer, right before September's prepayments return. An average of 2.89 months says "almost three"; the table says "short by 147,319.75 in August".

The month-by-month view also shows what to fix and when: the problem is concentrated in August, and 432,000 of August's burn is a purchase whose timing is a choice. Always build the table of closing balances and read its lowest row before saying "we make it".

A company is default alive if, on its current course, it reaches profitable ground before the cash runs out, without new money. For a startup that ground is break-even. For a seasonal business like Klasna it is the next good season: September, when families start prepaying again.

On 31 May Klasna's runway is 2.89 months against three months to September: not quite. And averages are kind. Month by month the forecast ends August at −147,319.75 UAH, and 432,000 of August's burn is the new laptops.

What changes the answer? Remove the laptops from the summer:

• net burn: 3,933,617.75 − 432,000 = 3,501,617.75, or 1,167,205.92 a month;
• runway: 3,786,298 ÷ 1,167,205.92 = 3.24 months, just past September;
• month by month, August would close at −147,319.75 + 432,000 = 284,680.25.

One decision, the timing of a single purchase, separates needing a loan from reaching September on Klasna's own money.

When the lowest month is caused by a one-off payment, the simplest lever is timing: pay later, or pay in parts.

Hanna's forecast ends August at −147,319.75 UAH, with all 432,000 of laptops paid in August. Options:

• Buy none in August: closing cash −147,319.75 + 432,000 = 284,680.25.
• Buy half in August, half in October: −147,319.75 + 216,000 = 68,680.25.
• Buy all in August: −147,319.75, which needs a loan or an overdraft.

Each hryvnia not paid in August raises the lowest balance by one hryvnia. Moving the second half to October works because September and October bring families' prepayments back, so the October payment lands in a month with cash coming in.

Two cautions. A thin cushion, like 68,680.25, can disappear with one weaker month of payments, so compare it with how uncertain the forecast is. And moving a purchase is only free if the delay costs nothing: if tutors or the team need the laptops in August, the trade-off has to be named.