How to: Runway
Runway shows how your cash position evolves over time on a monthly basis. It highlights when liquidity comes under pressure — and how operational or financing decisions affect that timing.
Core concept
The runway view translates your annual model into a monthly cash profile. Instead of only seeing year-end positions, you understand when cash actually peaks or drops within the year.
This is critical for identifying short-term liquidity gaps, timing of financing needs, and the real impact of operational decisions.
What Runway shows
- • Monthly cash development over the forecast period
- • Timing of cash dips and peaks
- • Periods where cash drops below zero
- • Impact of revenue timing and capex phasing
How to use Runway
- Ensure your baseline P&L and balance sheet are complete
- Adjust timing assumptions (revenue, capex, working capital)
- Review the monthly cash chart
- Identify when cash pressure occurs
Why it matters
Annual models often hide short-term liquidity risks. A business may appear stable on a yearly basis, while facing critical cash pressure within specific months.
Runway makes these risks visible early, allowing better decisions on financing, cost adjustments or investment timing.