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Hey HN - Henrique here co-founder of Brex (YC W’17). I wanted to introduce the HN community to some new data we gathered at Brex as part of our new blog. We s

Hey HN - Henrique here co-founder of Brex (YC W’17). I wanted to introduce the HN community to some new data we gathered at Brex as part of our new blog. We specifically looked to highlight data that is not available to other startups. + We focused on startup cash burn rates by funding stage (pre-seed, seed, Series A, etc.) because for many startups there is always this question about how much you should be burning. + Separately, we looked at some of the most popular vendors for startups on Brex in categories like cloud services, CRM, rideshare etc. + We analyzed the size of the "stealth" startup market. For Brex, it was hard being in stealth for over a year and it's helpful to know just how many of you are out there + We looked at regional trends in startup cash burn to help startups adjust their benchmarking for their locations Note, we were careful to aggregate the data and only share things we thought could actually help startup founders and early employees Let me know your feedback! Henrique

vlovich123 8y ago
Doing a COL adjustment/average employee salary to burn rate could be interesting to normalize the data. In other words is the salary of engineers driving the disparity or are there other factors behind the burn rates.
- hdubugras 8y ago
  Exactly. Our plan going forward is to start breaking down burn by major factors like salary, rent, vendor spend. Another interesting one we're looking at is the breakdown of burn by industry and stage. We can also then compare the major factors across these breakdowns to give really good comparisons for startups.
  - vlovich123 8y ago
    Other interesting normalization metrics to consider is # of FT employees, contractors & revenue.
    - hdubugras 8y ago
      Yes, all worthwhile normalizations!
wgyn 8y ago
Really interesting report! And love the idea of benchmarking against similar stage companies :) Do the burn rates include spending on payroll?
- hdubugras 8y ago
  Thanks! Burn rate is inclusive of payroll, yes. Everything that eventually hits the bank account will be included in the burn rate.
calcsam 8y ago
Burn is the numerator, $ raised or cash-in-the-bank is the denominator. Would be really good to get a 2x2 grid of monthly burn x money raised for Series A companies. Or if that's too hard, a "Months the Series A will last at at current burn rate" bar chart.
- hdubugras 8y ago
  We can definitely add a runway / months to exhaustion to our next analysis.
  - calcsam 8y ago
    That would be good. Runway is one metric -- the one I'm most interested is "how long are you _planning_ the A to last for?" If you raise eg $10M and you ramp burn to $400k monthly, the answer is 24 months. Regardless of where you are in those 24 months.
    - hdubugras 8y ago
      Sure, it might be interesting to compare rounds this way, on how long each round is planned to last.

vlovich123 8y ago

Doing a COL adjustment/average employee salary to burn rate could be interesting to normalize the data. In other words is the salary of engineers driving the disparity or are there other factors behind the burn rates.

hdubugras 8y ago
Exactly. Our plan going forward is to start breaking down burn by major factors like salary, rent, vendor spend. Another interesting one we're looking at is the breakdown of burn by industry and stage. We can also then compare the major factors across these breakdowns to give really good comparisons for startups.
- vlovich123 8y ago
  Other interesting normalization metrics to consider is # of FT employees, contractors & revenue.
  - hdubugras 8y ago
    Yes, all worthwhile normalizations!

wgyn 8y ago

Really interesting report! And love the idea of benchmarking against similar stage companies :) Do the burn rates include spending on payroll?

hdubugras 8y ago
Thanks! Burn rate is inclusive of payroll, yes. Everything that eventually hits the bank account will be included in the burn rate.

calcsam 8y ago

Burn is the numerator, $ raised or cash-in-the-bank is the denominator. Would be really good to get a 2x2 grid of monthly burn x money raised for Series A companies. Or if that's too hard, a "Months the Series A will last at at current burn rate" bar chart.

hdubugras 8y ago
We can definitely add a runway / months to exhaustion to our next analysis.
- calcsam 8y ago
  That would be good. Runway is one metric -- the one I'm most interested is "how long are you _planning_ the A to last for?" If you raise eg $10M and you ramp burn to $400k monthly, the answer is 24 months. Regardless of where you are in those 24 months.
  - hdubugras 8y ago
    Sure, it might be interesting to compare rounds this way, on how long each round is planned to last.