The standard burn multiple works well for SaaS businesses, but it doesn't apply effectively in medtech.
In medtech, the risk isn't just about the product; it's about the added delays caused by regulatory approvals. There's often a divide between what founders say about regulatory timelines and what investors actually believe. We’ve seen countless pitch decks showing capital use plans assuming smooth FDA timelines for approvals. Smooth and quick are incongruent with seeking FDA approval.
We often think about regulatory AI — not the chatbot kind, but the FDA “Additional Information” kind. In the best of times, those AI requests will happen in the target of 90 “FDA days.”
But what founders don’t account for is that they often pause your FDA clock, drag your cash flow, and burn months of runway. And rarely do we see startups model that risk into their capital plan.
The bottom line? Every extra month silently compounds your burn rate.
Enter the Regulatory-Adjusted Burn (RA-Burn) Tool
It’s a way to account for the likelihood that your grant, milestone, or pre-buy will land on schedule—factoring in timing risk for non-dilutive capital sources like revenue, not just investment.
RA-Burn = Net Burn ÷ (New ARR + (Non-Dilutive Cash × P on-time approval))
The P = the probability that a regulatory milestone or non-dilutive cash event (grant, tranche, clearance-tied payment, etc.) lands on schedule.
The lower the probability, the smaller your effective non-dilutive cash — and the higher your RA-Burn multiple means weaker capital efficiency.
Explore the RA-Burn Tool
What the tool does and why It matters
- Reg-Burn adjustment for government shutdowns: Automatically models increased “regulatory burn” risk / delay impact if a government shutdown occurs
- Information Request Logic: Allows you to insert conditional info requests (e.g. “if you’re > $X in revenue, fill in extra fields”) to get richer outputs.
- Pre-Revenue & Post-Revenue Scenarios You can toggle between “pre-revenue” or “post-revenue” modes to simulate different growth stages.
- Grant Probability & Impact on Burn Rate: Add in your probability of securing grants, and see how that shifts your burn, runway, and sensitivity.
- Scenario Sensitivity Analysis: More knobs (e.g. regulatory delays, cost overruns, tiered cost structure) so you can stress-test worst/best cases.
- User-Adjustable Assumptions: You can override default assumptions (e.g. hiring ramp, regulatory milestones) to reflect your reality.
- Version Tracking + Change Log: You can see what changed, when, and why — useful for comparing your old vs new runs.
We want your feedback
We built this to evolve with your needs, not be a static “one-and-done” widget.
- Startups: Try it out and let us know what you think.
- Investors: How do you address this?
- Regulatory experts: What guidance do you have on this?
Some questions to get feedback flowing
- Which features above are most or least useful to you—and why?
- Did the regression / shutdown modeling feel realistic or off?
- Where did you struggle with inputs or assumptions?
- What additional knobs or parameters would you want (that aren’t there)?
- Did the output help you make a decision (e.g. “pull spend,” “raise more,” “pivot”)?
