How to Understand and Extend Your Financial Runway — A Simple Guide for Small Business Owners

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Most small business owners are playing a game of financial chicken, and they don’t even realize it.

If you’re one of these business owners, you’re likely grinding through each month, covering expenses and hoping the next payment hits before the cash runs out. But without knowing exactly how long your current revenue and reserves will sustain you, you’re essentially flying blind. That’s where understanding your runway comes in.

Related: Spend Less Time Worrying About Your Company’s Runway — And More Time Rethinking Your Strategy. Here’s How.

What is “runway” in business?

Runway refers to how long your business can continue operating before it