The burn multiple, popularized by David Sacks, divides net burn by net new annual recurring revenue over a period. It answers a blunt question: how many dollars is the company burning to add one dollar of new recurring revenue?
A lower burn multiple signals efficient growth; a high one warns that growth is being bought expensively. It has become a favoured efficiency metric in tighter funding markets, complementing growth-rate and Rule-of-40 views.