Burn rate vs. runway, said cleanly.

Burn rate is the speed you are losing money per unit of time, almost always per month. Gross burn is total cash operating outflow. Net burn is gross burn minus cash inflow from revenue. The two diverge meaningfully once a company has paying customers — which is when it starts to matter. Runway is the time you have left at current net burn. Cash divided by net burn. Twelve months means twelve months. The honest version forecasts forward, not back: if you signed two big customers last quarter, your trailing burn overstates your forward burn. If you just hired five engineers, the reverse. Two common mistakes: calculating burn off P&L instead of cash (depreciation, accruals, stock comp distort it), and treating "ARR / 12" as cash inflow (it is not — billings, collections, and revenue are different events). The board cares about runway because it sets the timing of every other decision. Build the forecast in a tool you will actually update; spreadsheets that get touched once per quarter lie.