What is Gross Burn?
A company's Gross Burn is the total cash spent on operations. These costs typically include all salaries, rent, and other overhead as well as interest and taxes.
This metric is often confused with Net Burn, which is a measure of negative cash flow, and includes revenue and expenses.
How to calculate Gross Burn
ƒ (COGS + Salaries and Overhead + Depreciation and Amortization + Other Operating Expenses + Interest and Taxes)
More about this metric
Gross Burn includes expenses such as manufacturing costs, salaries, contractors, sales commissions, employee benefits, marketing and advertising, transportation and travel, amortization and depreciation, rent, repairs, and taxes.
In most cases, Gross Burn is reported as a monthly number.
Metrics related to Gross Burn