Exponential Growth Rate Calculator
Determine the percentage growth rate per period and get the exact Excel syntax.
How to Calculate Exponential Growth in Excel
Exponential growth occurs when the growth rate of a value is proportional to its current size, resulting in the value growing faster as it gets larger. This is common in finance, population studies, and microbiology. To calculate this in Excel, you primarily use the compound annual growth rate (CAGR) logic or natural logarithms for continuous growth.
The Mathematical Formula
The standard formula for calculating the exponential growth rate (r) over a specific number of periods (n) is:
r = (Ending Value / Beginning Value) ^ (1 / n) – 1
Step-by-Step Excel Methods
Method 1: Using the Power Operator (^)
This is the most direct way to calculate growth. If your starting value is in A1, ending value in B1, and years in C1, the formula is:
=(B1/A1)^(1/C1)-1
Method 2: Using the RRI Function
Excel provides a built-in function specifically for calculating an equivalent interest rate for growth:
=RRI(number_of_periods, start_value, end_value)
Practical Example
| Scenario | Start Value | End Value | Periods | Growth Rate |
|---|---|---|---|---|
| Revenue Growth | 50,000 | 125,000 | 4 Years | 25.74% |
| User Base | 1,000 | 10,000 | 12 Months | 21.15% |
Frequently Asked Questions
What is the difference between linear and exponential growth?
Linear growth adds a fixed amount every period (e.g., $100 every month), while exponential growth adds a fixed percentage (e.g., 5% every month). Exponential growth results in a curve that steepens over time.
Can the growth rate be negative?
Yes. If the ending value is lower than the starting value, the calculation will result in a negative growth rate, indicating exponential decay.