The Market


Search Engine Advertising Revenue
Google’s parent company Alphabet has reported advertising revenue of $32.6 billion for the second quarter of 2019. This is compared to $28.09 billion during the same period last year.

Since 2011 Google's revenues have roughly tripled. In 2014, Google made $65.67B in revenues. In 2015, Google made $74.5B. In 2016, Google made $89.46B. For fiscal year 2017, Google reported revenues of $110.8 Billion.

Some of Google's largest customers:
• AT&T – Spent $40.8 Million on Google advertising.
• Verizon – Spent $22.9 Million on Google advertising.
• Go Daddy – Spent $21.7 Million on Google advertising.
• Comcast – Spent $19 Million on Google advertising.
• Direct TV – Spent $18.4 Million on Google advertising.

It’s well-known that Google has dominated the search engine market, but it is not the only search engine. Microsoft's Bing search engine is growing quickly, too.

Finances

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Income
Google handles some 1.2 trillion search queries per year. It reported advertising revenue of $32.6 billion for the second quarter of 2019 (source: https://www.mediapost.com).

Advertising to such a huge market has been very profitable for Google. It is estimated that Google reaches approximately 90% of the market. Other search engines such as Microsoft Bing, Yahoo, Ask and DuckDuckGo take the remaining10% of the market.

Gander will offer a similar advertiser targeted platform. We will allow advertisers to develop and launch campaigns and display their advertisements in the Gander search listings. These ads will be triggered when someone searches for the targeted keyword.

If more than one advertiser bids for a certain keyword or for an advertisement placement the winner will be decided by triggering an auction. The winner of this auction will be decided by looking into two key metrics: the CPC bid (the maximum amount they are willing to bid for a click on the ad) and the quality score (a metric which decides how relevant your ad is to the user). The product of these two metrics results in the ad rank of the advertisers and the one with the best ad rank will win the auction.

 

Expected Sales
The sales objective is by the third year of operation to gain the equivalent of one twentieth of one percent (0.05%) of Google's 2019 advertising revenue. As the Gander brand awareness increases, our advertising revenue is projected to increase to the equivalent of 1% of Google's advertising revenue by year 6.

 

Expenses

Expenses are calculated annually, in US dollars.

Operating Expenses
There are four cost centres: executive, technical, account management marketing. The office and control room which maintains the social media accounts and provides technical support and is in the same facility used by staff supporting advertising sales and canvassing for clients. The expenses are based on the third year of operation.

Salaries & Wages
Overhead Expenses
Marketing Expenses

 

Computer Server Expenses

This expense relates to the leasing costs of servers which Gander uses to provide the computing power for its search engine.

We are calculating server computing requirements at the same rate as Google. The research firm Gartner estimates that Google has 2.5 million servers. Traditionally, Google has relied on parallel computing on commodity hardware like mainstream x86 computers (similar to home PCs) to keep costs per query low.

The amount of servers required is calculated by the following:

Google's servers process 1.2 trillion search queries per year, using 2.5 million servers.
This means that each server can process half a million queries per year.

  

Gross Margin
This is the gross margin before tax in the third year of operation based on gaining the equivalent of one twentieth (.05%) of one percent of Google's advertising revenue.

 

Return to capital

Value of assets based on yield - third year of operation (before tax)

  

Start-up Capital Requirements

Capital is required to apply the research into the Gander search engine technology and bring it to market.

Projected Sales Revenue in US$

Market Share      Quarterly          Annual

Year 3   .

005%   $ 16,300,000     $ 65,200,000

 

Year 4   

.1%     $ 32,600,000     $ 130,400,000


Year 5   

.5%     $ 163,000,000   $ 652,000,000


Year 6 

1%      $ 326,000,000   $ 1,304,000,000

Annual Gross Margin (Year 3)

Income: $ 65,200,000
Expenses:
Salaries & wages $ 9,000,000
Overhead Expenses $ 500,000
Marketing Expenses $ 6,000,000
Server Expenses $ 3,600,000
Total $19,100,000

Net Profit before tax
$46,100,000

The Product

Gander represents the next generation is search engines. It is motivated by the demand for information that is happening here and now. Our physical surroundings are becoming populated with a growing amount of digital information. This is generated by such things as:

• people with mobile devices such as smart phones and tablets
• digital resources embedded in the environment such as in cars, buildings and appliances.

Gander allows you to search for information in a rapidly changing, information rich environment.

Capital Return

Value of assets based on yield (Year 3)
Yield (1 years net profit) $ 46,100,000
Capital value of asset $ 100,000,000
Percentage Return on Capital

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