#005: Exponential Growth vs. Linear Growth

Grab a normal sized sheet of paper. 8.5 x 11, to be exact (or follow along in your imagination).
Fold it in half.
Now fold it in half again.
Keep folding it in half until you can’t anymore.
You should be able to fold it in half 7 times, before it’s no longer possible.
Look at how thick it is. Perhaps an inch or two?

Pop Quiz: How thick would it be if you had a paper large enough that you could fold it in half 50 times?
Thought about it?
Ok, what’s your guess?
Most people would guess the height of a person, or perhaps to the ceiling.
What if I told you the correct answer is from here to the sun?

This is exponential growth. Our human minds struggle to comprehend exponential growth because our brains are wired to think linearly. Our experience and intuition is based on the world around us, where things grow at a linear rate.
Now… what if you could grow your wealth exponentially, as opposed to linearly? In fact, this is exactly what the most successful investors do.

In the folded paper example, exponential growth occurs because the thickness of the paper is doubling. You can see the exponential growth very clearly. 1 becomes 2. Then 4. Then 8. 16. 32. 64. 128. 256. And so on.
But exponential growth can be generated with smaller percentages as well.
Warren Buffett’s net worth of over $100 billion was generated over many years of 22% growth.
Next week, we’ll discuss how you can harness the power of exponential growth… through the magic of compounding.

To your prosperity,
Wealth Potion