Know your metric
Importance of
Burn Multiple
Financial Health Assessment
Indicates how efficiently a company is using its capital.
Sustainability Indicator
Helps gauge the sustainability of the company’s growth.
Investor Attractiveness
Used by investors to assess risk and potential for investment.
Drawbacks of
Burn Multiple
Can Be Misleading
High burn might be strategic for growth phases.
Not a Standalone Metric
Needs to be considered with other financial indicators.
Variability
Affected by fluctuating revenues and expenditures.
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