The newcomer will compete with the incumbents - Ananzi and Aardvark.
Funnel has also introduced the country's first "pay-per-click" advertising programme.
The main purpose of launching Funnel is to relieve internet users of the congestion caused by overwhelming advertising.
There are more than 4 million internet users in South Africa.
"The key reason behind starting another search engine is guided by the fact that South Africa requires a more advanced and efficient channel through which business and non-business people can acquire information at the click of a button," Funnel MD Gideon Galloway said.
The search engine offers several unique benefits such as crawling and updating the South African IP ranges frequently.
Unlike its rivals, it is not cluttered with advertising banners that are time consuming to download.
