Calculate your startup's Burn Multiple (Net Burn / Net New ARR) to measure capital efficiency. This essential SaaS metric, popularized by David Sacks and Bessemer Venture Partners, reveals how much cash you burn to generate each dollar of new ARR. Use our free calculator to benchmark your efficiency against Seed, Series A, and Series B standards for 2025. Features include: Burn Multiple Formula calculation, Hype Ratio, Magic Number analysis, and CAC Payback period. Perfect for founders preparing for fundraising and VCs evaluating "default alive" status.

Frequently Asked Questions

What is a good Burn Multiple for a SaaS startup?

According to 2025 benchmarks from top VCs like Bessemer and Craft Ventures: <1.0x is proficient (Best-in-class), 1.0x-1.5x is Efficient (Excellent), 1.5x-2.0x is Good, 2.0x-3.0x is Suspect, and >3.0x is Inefficient.

A Burn Multiple under 1.5x is generally required for a strong Series A or B round in the current market.

How is Burn Multiple calculated?

The formula is: Burn Multiple = Net Burn / Net New ARR.

Net Burn is your cash burn minus revenue.

Net New ARR is the new Annual Recurring Revenue added in the period (New Logo ARR + Upsell ARR - Churn ARR - Downsell ARR).

Ideally, you want to burn less cash than the new revenue you generate.

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  • Author: SuperCalc Editorial Team
  • Reviewed: SuperCalc Editors (clarity & accuracy)
  • Last updated: 2026-01-13

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Financial/Tax Disclaimer

This tool does not provide financial, investment, or tax advice. Calculations are estimates and may not reflect your specific situation. Consider consulting a licensed professional before making decisions.