Start-up Cost & Runway Calculator

A start-up cost is any expense you have to pay to get the business trading. It's useful to split them into two buckets:

• One-off setup costs: things you pay once to open the doors — company/ABN registration, a website, initial stock, equipment, tools, a laptop, bond on a lease, professional advice, branding, and any licences or permits.
• Monthly fixed costs: the recurring bills that keep running whether you make a sale or not — rent, software subscriptions, insurance, accounting, phone/internet, wages, and loan repayments.

Keeping the two separate matters, because your upfront cash is driven by the one-offs, while your runway is driven by the monthly burn. This calculator uses exactly that split.

There's no single number, but common rules of thumb are:

• Side business / sole trader: aim for at least 3–6 months of runway so a slow start or a late-paying client doesn't sink you.
• Full-time small business: 6–12 months is the usual comfort zone — enough to survive a bad quarter and still pay yourself.
• Anything venture-backed or scaling fast: investors typically want to see 12–18 months so you can hit milestones before needing to raise again.

The longer your runway, the more mistakes you can survive. If this calculator shows only a couple of months, the fix is usually the same three levers: cut fixed costs, raise more starting capital, or bring revenue forward.

The government fees are modest — the real cost is usually the advice around them:

• ABN: free to apply for through the Australian Business Register (ABR).
• Business name: registered with ASIC — roughly $44 for one year or $102 for three years (fees are indexed, so check ASIC for the current amount).
• Registering a company: an ASIC company registration fee applies (a few hundred dollars), plus an annual review fee each year after.
• GST registration: free — you register through the ATO (often at the same time as your ABN) once your turnover hits, or is expected to hit, $75,000 a year.

Budget separately for an accountant or online service to set the structure up correctly, since getting the entity type right up front is cheaper than fixing it later. General information, not financial advice.

A lean sole trader can start for very little, but a realistic first-year budget usually includes:

• Setup: business name registration, a simple website/domain, basic branding, and a laptop or key tools — often a few hundred to a couple of thousand dollars.
• Recurring: accounting software, professional indemnity/public liability insurance, phone and internet, and an accountant for your tax return.
• Tax set-aside: as a sole trader you pay income tax on profit, so many people set aside a portion of every payment for the ATO — this isn't a "cost" exactly, but it protects your runway.

The big variable is whether you need premises, stock or staff. A service-based sole trader (consultant, tradie, freelancer) is far cheaper to start than a retailer carrying inventory.

Burn is how much cash you lose each month once your income is taken into account. This calculator works it out as:

Monthly burn = Monthly fixed costs − Expected monthly revenue (never below $0)

If your revenue already covers your fixed costs, burn is $0 and you're effectively cash-flow positive — your runway is unlimited from that revenue alone. If revenue is lower than your costs, the shortfall is what eats into your cash reserves each month.

Note this is a simplified planning figure: it treats revenue and costs as steady. Real businesses have lumpy sales, seasonal swings and one-off bills, so always keep a buffer on top of the runway the calculator shows.

Runway is how many months your cash will last at the current burn rate:

Cash after setup = Starting capital − One-off setup costs

Runway (months) = Cash after setup ÷ Monthly burn (rounded down to whole months)

We round down because a "half month" of runway isn't a full month of safety. If your expected revenue is equal to or greater than your fixed costs, burn is $0, there's nothing eating your cash, and the runway shows as "∞ (revenue covers costs)" — meaning you can trade indefinitely on that revenue.

One caveat: if your one-off setup costs are larger than your starting capital, your cash after setup is negative — you're short before you even open. In that case you need more capital or a leaner setup before the runway maths matters. General information, not financial advice.