Funding Requirement Calculator
Estimate how much funding a business may need based on startup costs, monthly expenses, expected revenue and cash runway.
Overview
This funding requirement calculator helps estimate how much capital a business may need to cover startup costs and any monthly cash shortfall over a chosen runway period. Enter your one-time setup costs, monthly operating costs, expected revenue, contingency allowance and existing cash to get a simple funding estimate.
How it works
The calculator first works out whether your monthly operating costs are higher than your expected monthly revenue. If they are, it calculates the monthly cash shortfall and multiplies it by the number of runway months. It then adds your one-time startup costs, applies a contingency percentage as a buffer, and subtracts any cash you already have available. The result is the estimated additional funding requirement.
How to use this calculator
- 1Enter your one-time startup costs.
- 2Add your expected monthly operating costs.
- 3Enter the monthly revenue you expect to generate.
- 4Choose how many months of runway you want to fund.
- 5Set a contingency percentage for unexpected costs.
- 6Review the estimated funding required after existing cash is deducted.
Example Calculation
Startup costs
$30,000
Monthly operating costs
$10,000
Expected monthly revenue
$6,000
Cash runway
12
Contingency allowance
10%
Existing cash available
$15,000
Estimated funding required
$70,800
With startup costs of $30,000, a monthly shortfall of $4,000 for 12 months, and a 10% contingency, the gross requirement is about $85,800. After $15,000 of existing cash, the estimated additional funding needed is about $70,800.
Frequently asked questions
What does this funding requirement calculator estimate?
It estimates how much additional funding a business may need by combining startup costs, projected monthly cash shortfalls, a contingency buffer and existing cash available.
What is a monthly cash shortfall?
A monthly cash shortfall is the gap between your monthly operating costs and expected monthly revenue when costs are higher than revenue.
Why should I include a contingency allowance?
A contingency allowance adds a buffer for unexpected expenses, delays, lower sales or cost increases that can affect your cash needs.
Does this calculator include loan interest or investor returns?
No. It is a simple planning tool and does not include borrowing costs, repayment schedules, equity dilution or investor return expectations.
What if my expected revenue is higher than my operating costs?
If your revenue covers your operating costs, the calculator treats the monthly shortfall as zero and focuses on startup costs, contingency and existing cash.
Can I use this calculator for an existing business?
Yes. It can also be used by existing businesses to estimate funding needed for expansion, a new product launch or a period of reduced cash flow.
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Assumptions and warnings
Assumptions
- Revenue and operating costs are assumed to stay broadly consistent during the selected runway period.
- The contingency allowance is applied to startup costs plus projected operating shortfall.
- Existing cash is treated as fully available to cover the funding need.
- This calculator provides a simplified estimate and does not include financing costs, taxes or detailed cash flow timing.
Warnings
- This calculator provides an estimate only and is not financial advice.
- Review your assumptions carefully before making borrowing, investment or business planning decisions.