Google’s domination of the search engine market is undisputed, but over the last 12 months, we’ve seen a new wave of competitors: Neeva, You, and now Yep. Members of a group only attack the alpha when they think they have a chance. Capturing even 1% of Google’s $148B search market means building a Decacorn. So, the monetary potential is there - but is the product opportunity?
Ahrefs thinks it is and recently announced it’s building a search engine (Yep). Other than DuckDuckGo or Neeva, Yep builds its own web index, which makes sense because it’s already crawling the web for data. Yep’s most important differentiator is that Yep plans to share 90% of its revenue with websites, a business model primarily known for social networks. 
Rev share, the key to winning creators
If Yep can get to 1% of Google’s market share, it can make about $15B a year. A 90% payout to creators would come down to $13.5B - a good start compared to other platforms.
Youtube shared a bit over 50% of revenue with creators and paid out an estimated $30B in 2021. To be eligible for rev share, channels need at least 1,000 followers, and the Dollar amount is determined by the engagement (measured in views) on the channel’s videos. 
Tik Tok recently announced to share revenue with creators in the same way Youtube does (50%) in a program called Tik Tok Pulse. Creators need at least 100,000 to be eligible. Due to the fact that Tik Tok surpassed Youtube, rev share makes the platform even more interesting for creators. 
Other companies were less successful in their revenue sharing efforts. Snapchat started paying verified creators (called “Stars”), but how much is still unclear. Instagram’s program is not very impactful for creators. And Twitter tried a rev share program back in 2016 but never materialized it. The only effort that survived is Twitter Super Follows, which is not ad-supported but user-supported monetization. 
One big question remains: how is Yep going to decide how much to pay a website/creator for content?
One way I could see it play out is by taking an average click curve of the top 10 results and paying the corresponding share of ad revenue from a specific keyword.
Let’s take the keyword “business cards,” for example. It has a monthly search volume of 366,000 (US) and a CPC of $11. According to Ahrefs, 34% of searches end in ad clicks, which comes down to 120,000 for “business cards.” Multiplied with $11 cost-per-click, that’s $1.3M of monthly revenue from this one keyword alone.
Ahrefs determines that 78% of clicks go to the first result (Vistaprint), 15% to the second, 4% to the third, etc. Based on that logic, Vistaprint would get $1M (78% * $1.3M), Moo $195K, and Zazzle $52K every month. Not a bad payout, considering those sites rank for other keywords as well, and that’s just the monthly sum.
Monetization and rev sharing is just one piece of Yep’s potential. To understand how Yep could compete with Google, we need to look at the different product dimensions of search engines.
Search engine product dimensions
We’re used to the idea of a search engine Google presents to us, but there are so many more. Search engines have different product dimensions that decide their use cases and features.
First, there is the dimension of generalization vs. specialization. Google, Youtube, Neeva, and DuckDuckGo are general search engines, whereas Amazon, Booking, Yelp, Pinterest, or Tripadvisor specialize in verticals. General search obviously targets a larger market but specialization provides helpful answers faster.
Second, search engines need to get to feature parity to compete. Pinterest doesn’t need the same features as Google because they are indirect competitors. Bing, however, needs to be at least as good as Google, if not better. Every modern search engine needs to provide privacy features, for example. However, if that was enough to be successful, DuckDuckGo would have a significantly higher market share.
The third dimension is integration vs. modularity. Most search engines own the whole experience, from receiving the search query (for now through text, voice, or images) to displaying results. Google doesn’t integrate with other apps but owns the full experience, from multimedia to text results, local, or direct answers.
Modular search engines like You or Neeva, on the other hand, provide a base platform and then allow other apps to connect with it. They provide connections with your favorite apps and let you either search through or interact with them (think: searching flights on Booking, recipes on TheKitchn, products on Amazon, movies on Netflix, or your files on Dropbox).
Lastly, we have monetization, and this is where it gets interesting. Google makes money by users clicking on ads. They’re funded by companies who want to reach those users. Websites are a means to an end because they provide content for users, but if Google could create the content itself, it would still make a lot of money.
Yep tries to change that by sharing advertising revenue with content providers. So far, the benefit for websites of being on Google is “free” web traffic that maybe converts into customers. That has been a good deal most of the time. But what if websites got a direct cut from the advertising revenue the search engines make with their content?
It would provide an immediate benefit for sites that provide information to create value, like Wikipedia or publisher/affiliate/review sites. Especially publishers might see a second wind without having to go direct-to-consumer. SaaS companies and ecommerce sites, though, wouldn’t benefit as much since they want customers. As a result, Yep is a creator search engine. It rewards websites like Youtube, or soon Tik Tok rewards their content creators.
But there is a massive challenge to overcome.
Demand = biggest nut to crack for Yep
Google is a classic aggregator that channels demand with a superior user experience to control supply. Users come to Google because they get a lot for free: search results, email, navigation, local search, etc. All the free stuff is sponsored by advertisement. Even though I think ads are a bad business model, it clearly works for Google and make it one of the most successful companies in history.
While Yep is more attractive to the supply side of this triple-sided marketplace (advertisers, websites, users) than Google, its biggest nut to crack is getting enough demand (=users). Why should someone use Yep instead of Google for search? That’s the part of the equation that’s still a big X. Once that X is resolved, Yep has a real chance to bite a crumble out of Google’s cookie.
How could Yep do it? A couple of thoughts. The chance of Yep providing superior search results and catching up to Google’s two-decade sprint of machine learning-powered quality is low. One way to open the door is through partnerships. Like how Google pays many Billions of Dollars to be the default search engine on iOS, Yep could seek ways to become the default on other devices or apps.
Another way could be building a platform similar to You that integrates with other apps to build a universal command center (think CMD + Space on Mac OS). The benefit is being able to position itself as a starting point for any type of search is huge, but the challenge is doing something You doesn’t already do.