Growth Rate Calculator

Calculate compound annual growth rate (CAGR) and period-over-period growth. Measure business growth velocity.

Total Growth
totalGrowth%
Overall growth percentage
CAGR
cagr%
Compound annual growth rate
Average Period Growth
averageGrowth%
Simple average growth per period
Periods to 2x
periodsToDouble
Time to double at current CAGR
💡 Growth Rate Insights
• CAGR smooths volatility for accurate long-term growth
• CAGR = ((Ending / Starting) ^ (1 / periods)) - 1
• Early-stage companies: 100-300% CAGR common
• Growth-stage: 40-100% CAGR sustainable
• Public companies: 20-50% CAGR considered strong

Growth Rate Calculation

Growth rate measures how fast a metric increases over time, with CAGR showing compound growth.

CAGR Formula

CAGR = ((Ending / Starting) ^ (1 / Periods)) - 1

When to Use CAGR

Use CAGR when you need to:

  • Compare growth rates across different time periods
  • Smooth out year-over-year volatility
  • Project future values based on historical growth
  • Evaluate investment returns

Example

SaaS company grows from $1M to $10M ARR in 4 years:

  • Total growth: 900% (10x)
  • CAGR: 78.4% per year
  • Simple average: 225% per year (misleading)
  • Years to double again: ~1.3 years at 78.4% CAGR

CAGR shows sustainable annual rate assuming consistent compounding.

Frequently Asked Questions

What is CAGR?

Compound Annual Growth Rate (CAGR) measures growth rate over multiple periods with compounding. Formula: ((Ending Value / Starting Value) ^ (1 / Years)) - 1. Example: $100k to $250k in 3 years = 35.7% CAGR. CAGR smooths volatility unlike simple average. Use CAGR for multi-year projections and comparisons.

What is the difference between CAGR and average growth rate?

CAGR accounts for compounding, average growth doesn't. Example: $100 grows 50% year 1 ($150), then -20% year 2 ($120). Average = (50% - 20%) / 2 = 15% per year. CAGR = ((120/100) ^ (1/2)) - 1 = 9.5% per year. CAGR is more accurate for multi-period growth. Use CAGR for investments and forecasting.

What is a good growth rate?

Good growth varies by stage: Early-stage startups 100-300% CAGR (tripling annually), Growth-stage 50-100% CAGR, Mature companies 10-25% CAGR, Public companies 20-50% CAGR is strong. Context matters: industry, market size, profitability. Rule of 40: Growth % + Profit margin % should exceed 40 for SaaS.

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ARR Calculator

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