Calculate the Compound Monthly Growth Rate (CMGR) in Excel

Compound Monthly Growth Rate (CMGR) is your growth rate over a given period, assuming the growth is at a constant rate every month. CMGR is similar to the Compound Annual Growth Rate (CAGR), but monthly instead of annually. I'm using CMGR since you may not have years of data to work with, but you have months of data you can use. CMGR and CAGR are excellent tools for investments, YouTube creators, or businesses analyzing subscribers, watch time, or revenue. You can use CMGR to calculate where you will be in 6, 12, or any number of months in the future.

Imagine that your active users were growing as follows:

Month Revenue % change
Mar 2020 100
Apr 2020 115 15.00%
May 2020 138 20.00%
Jun 2020 126 (8.70%)
Jul 2020 146 15.87%
Aug 2020 154 5.48%
Sep 2020 200 29.87%

Now you want to know two things: 1) What are my CMGR and 2) Where will I be in September 2021?
The CMGR is 12.25% rounded to two decimal places. It is (12.2462% with more decimal places)

If you start at 100 for March 2020, your base month, and multiple 100 times six periods (Apr through September), you would have 100 x 1.125 x 1.125 x 1.125 x 1.25 x 1.125 x 1.125

CAGR - Compound Annual Growth Rate
CMGR - Compound Monthly Growth Rate

Chapters:
0:00 Intro
1:18 Example with months
1:42 Month over month %
2:42 CMGR in steps
4:20 CMGR one formula
4:55 RRI function Excel
6:20 Test of CMGR
7:18 Forecast out
9:35 Check figure

I use CMGR to calculate my future YouTube revenue and subscribers. I'll make a specific video on how to calculate when you will reach 1,000 subscribers. You will need a few months of data.

Drawbacks: I'll discuss a few drawbacks with CMGR and CAGR in my next video.

And make sure you subscribe to my channel!

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[AdeusG]

Saved my butt with my new job. Thank you!!

[vidya]

There are 2 different type of compoundings.

Homework:

2 years compoundings:

Dividend Compounding = (1+g)²

Intrinsic Compounding = ?

[andru]

Hey Chris, i'm not sure if this is correct. What about that: Month 1: 100 Revenue - Month 2-5: 500 Revenue - Month 6: 100 Revenue. That would mean that your CMGR is 0 but there was a strong revenue increase in the months in between...

[NBA_NowandThen]

Thank you! Learned a new skill that's critical for our goals.

[Tavvy]

This does not work. Change your 200 to a different number and you'll see it does not work!!!

[aanchalvishavkarma]

This is really helpfull..I am from India (Noida) as a Sr. MIS Executive

[shawnphickman]

This was such a clear explanation of a calculation I was struggling with. Thank you for breaking it down step-by-step. It really helped me out!

[stanarthur]

I've never used Microsoft Excel but I have a 12 month growth rate of 2% per month. What is the annual growth rate?

[carloslara]

Lol I thought this was about the stock never mind ha

[joshlh]

Perfect! You totally solved a problem I've been trying to fix for a month now. Just subscribed! Thank you.

[Graphicious]

If you're obsessing over how fast your YouTube channel is growing, you can use this formula to forecast when you're going to have 1000 subscribers. Thanks for the video!

[broyston]

Thanks for the video. I'm trying to figure out the formula that will return the number of months to get to y dollars starting with x dollars and given a monthly growth rate. Any help (or video) on this?

[nattacev]

🛑 ❓I really hope someone can help me answer this: I thought that the CMGR was used to average out the growth rate for the months listed. I thought this was supposed to be ONLY one value since we want the value to encompass the dates listed as a whole.

If you/he are applying it to each month, wouldn’t we call this average monthly growth rate? Sorry… a little confused — please help! 🙏🏻 :)

[andrewvillamor]

I have watched sevral videos and still confused on how to calculate CGMR. Sir, you made it very simple. Kudos! A new subscriber here!!

[valyanurfadila]

Hi, would like to ask (and confirm) for a case of :
1) the number of revenue is all negative
2) say the beginning value is -5000 and the end value is -4000, for a period of 12 months

For the CMGR, following the formula above I would get a result of -1, 48%.
Considering that there is a positive growth in revenue (starts with -5000 and ends with -4000), should I add *(-1) so that the CAGR is positive of 1, 48% ? Thank you!

[tizme]

Excellent, video, my project is slightly different and would appreciate some feedback (project summary) this is to calculate future value of a current value the variable is the number of days, therefor the days value has to be a variable cell.
Formulae: (current fixed value* Number of days) * 10)) * fixed % = current value.
Future value is function of the number of days from the day starting value (ie todays vnumber value = 294 tomorrow will be 294+1)
One years time expressed as days will be 294+365. So the days variable cell would have 365 inserted. The formulae above will calculate the future value extrapolated from todays value.

So, the objective is to take todays and extrapolate for any number of future days. Nb: (current number of days increases * 1 per day). so calculation is current value * days to ^n power.
NB: the future number is a projection based upon the starting point snapshot.

Is there a flaw in my formulae and how can this be easily expressed in excel 365 ? can you help?

[InspiredByBudh]

Awesome calculation style, thanks so much Sir

[suzannemcginley]

Is there anyway to do this for months that don't have data in the cell - Some way to skip the empty, zero, non-numerical value in cells?

[billmoody]

Thank you for the great tutorial. Can this also be applied to a daily format? Also, I didn't see a link to the file.