Finance
Burn Rate
The rate at which a company spends its cash reserves, typically measured monthly. Gross burn rate is total spending; net burn rate accounts for revenue.
Biological Context
Burn rate parallels metabolic rate—how fast an organism consumes energy reserves. Like organisms with high metabolic rates, companies with high burn rates need frequent 'feeding' (funding) or they die. The relationship between burn rate and resources determines survival time.
Business Application
Burn rate determines how long a company can survive without additional funding or revenue. High burn rates accelerate growth but increase extinction risk. Managing burn rate is survival management.