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by • November 13, 2012 • Funding & investmentComments (4)311

3 months of runway

You quit your job with 3 months runway to go full-time on your project.

You launch in 3 months — hooray! But now you’re out of money and don’t have time to see if the business is going to work. Plus, it’s going to take you a month to find a job. You’re in a tight spot.

You launch in 3 months, but after the second month, you start hedging your bets by looking for jobs. At 3 months you still have no savings or data about whether the business is going to work, so you take the job.

You launch in 2 months and it turns out that it’s hard to build a profitable website. You’ve got some options, but it’s still tight. If you got lucky on version 1, maybe you’ve got either revenue to keep going or enough traction to raise some funding. If not, you have to decide whether to risk an empty bank account by spending the remaining month trying to improve it.

You launch in 1 month and now you’ve got a shot. You can safely spend another month trying to move the needle. If you aren’t on the up and up by then, it’s pretty easy to walk away. If things are going well, you’ve got a much more informed perspective on whether revenue or funding will be viable.

3 months of runway doesn’t mean you can spend 3 months building something. You’ve got a month to build, max. Similarly, if you have 12 months runway, you’d better be live in 2 or 3. The real work (and data) is in the follow-through.

If you can’t launch faster by scoping down, then you need to extend your runway by either increasing your savings, reducing your expenses, or holding onto a job for some of the time.

You don’t want to be in a situation where you’ve sunk your savings into building a product you can’t follow through on.

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4 Responses to 3 months of runway

  1. StartUpJerkFest says:

    damn, you keep writing these golden nuggets! i learned this lesson the hard way. launch day does not mean lotto money rains down from heaven. it usually means the cash vacuum was turned on and it’s sucking all your money away faster than before.

    • robfitz says:

      Ya… and really, the numbers in the article are generous since it takes way longer to close sales or funding than anyone would expect. Even if you close a big sale at month 3, it might take 60 days for it to hit your bank account. A bit of a buffer in the runway makes a big difference.

  2. Daniel says:

    Right on, get moving yall!

    =)

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