Startup Budget Calculator formula
Worked example
Using our calculator's default 12-month forecast inputs:
- Starting Cash Available: $15,000
- Fixed Monthly Expenses: $1,500 (Rent) + $4,500 (Salaries) + $350 (Software) + $1,200 (Marketing) + $250 (Utilities) + $200 (Other) = $8,000 / month
- Revenue & Cost Assumptions: $4,500 in Month 1 revenue, 15% monthly revenue growth rate, and 20% variable cost (COGS)
1. Month 1 Cash Flow:
Revenue_1 = $4,500 | Variable Cost_1 (20%) = $900
Net Cash Flow_1 = $4,500 - $900 - $8,000 = -$4,400
Ending Cash_1 = $15,000 - $4,400 = $10,600
2. Cash-Out Month & Lowest Cash Trough (Months 5 & 6):
Month 5: Revenue = $7,871 | Net Cash Flow = -$1,704 | Ending Cash = -$727 (Cash-Out Month)
Month 6: Revenue = $9,051 | Net Cash Flow = -$759 | Ending Cash = -$1,487 (Lowest Cash Point)
3. Operating Break-Even & Extra Funding Needed (Month 7):
Month 7: Revenue = $10,409 | Variable Cost = $2,082 | Net Cash Flow = +$327 (Break-Even!)
Extra Funding Needed = max(0, -(-$1,487)) = $1,487
Even though this startup reaches monthly profitability in Month 7 and ends Month 12 with $22,892 in cash, it briefly dips to -$1,487 in Month 6—meaning the founder needs at least $1,487 in extra funding (or cost reductions) to bridge the gap.