A startup budget is not a spreadsheet of hopes; it is the payroll line at the loaded cost, the other monthly spend, the revenue the company actually collects, and the cash in the bank, and the burn rate calculator is the four of them in one line: gross burn is payroll plus other spend, net burn is gross burn less revenue, runway is cash over net burn. The free payroll for startups calculator on this site works exactly that from the headcount, the salaries, the employer taxes and benefits, the other spend, the revenue and the cash, and Pro keeps each budget as a scenario the board can compare with the last one.
The payroll line is most of the budget
On a small team the loaded payroll is the largest line by far, and it is the line most budgets understate, because the salary is entered where the loaded cost belongs. Enter the headcount and the average salary, the employer taxes as a share of salary with the employer's share of Social Security and Medicare as the floor, and the benefits and payroll fees as a share, and the payroll line is the number that will leave the bank.
Other spend, revenue and the two burns
Rent, software, cloud, contractors and marketing make the other monthly spend; add it to the payroll and the gross burn is what the company spends. Take off the revenue actually collected in the month, not booked, and the net burn is what leaves the bank. Gross burn is the number a hiring plan changes; net burn is the number the runway is worked from, and the calculator prints both.
Runway, and the scenario the board should see
Cash over net burn is the months of runway, and it moves with every hire and every dollar collected. A budget is a scenario: this hiring plan, this spend, this revenue, this cash, these months. Pro on this site keeps each scenario and compares two side by side, so the plan the board approves is the one whose runway was read before the offers went out, and the approved one is kept as the record the next month is read against.
Questions people ask about startup budget
What is the difference between gross burn and net burn?
Gross burn is everything the company spends in a month, payroll and other spend; net burn is gross burn less the revenue collected in the month, and runway is cash over net burn.
How do I use a burn rate calculator for a startup budget?
Enter the headcount, the average salary, the employer taxes and benefits as percentages, the other monthly spend, the revenue collected and the cash; it prints the loaded payroll, both burns and the months of runway.
How often should a startup redo its budget?
Every month from the closed books, and whenever a hire, a raise or a revenue change is decided; a budget that is not re-read monthly is a forecast nobody checked.