Burn Rate

At the beginning of a startup's journey, you often spend more money than you make. The rate at which you spend your cash is called burn rate. 

Burn rate is a measure of negative cash flow and can help you determine when to raise your next round of capital or show investors how effectively you’re using their funds.  

If your startup burns money too quickly or has a negative cash flow, you may go bankrupt. If it burns too slowly, you may not be investing enough.

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