The acronym **CAGR** stands for **compound annual growth rate**, which is the average annualized revenue growth rate during a certain time period.

The formula to calculate CAGR is as follows:

CAGR = (future value / present value)^{1/periods} – 1

The following examples show two equivalent ways to calculate CAGR in Google Sheets.

**Method 1: Calculate CAGR Manually**

We can use the following formula to calculate CAGR manually in Google Sheets:

=(ENDING_VALUE/STARTING_VALUE)^(1/PERIODS)-1

The following screenshot shows how to use this formula to calculate CAGR for an investment that started at $1,000 and ended at $5,000 after 9 investment periods:

The CAGR is **19.58%**. This represents the compound annual growth rate of the investment during these 9 investment periods.

We can confirm this answer is correct by calculating the growth of an initial $1,000 investment if it grew consistently at 19.58% each year for 9 years:

**Method 2: Calculate CAGR Using RRI Function**

Another way to calculate CAGR in Google Sheets is by using the **RRI** function, which uses the following syntax:

**RRI(number of periods, starting value, ending value)**

The following screenshot shows how to use this function in practice:

This matches the value that we calculated manually using the previous method.