Mechanism partners with world-class
talent to co-launch ambitious tech startups.

The Mechanism Model

Mechanism works closely with both new and experienced entrepreneurs to launch tech startups. We serve as a cofounder that provides industry expertise, capital, ideas, and operational guidance. The entrepreneur brings exceptional execution, drive, and resilience. He or she receives a reasonable salary, earns meaningful equity and becomes the CEO of the new venture.

We prefer to work with entrepreneurs who are referred through our network, but we may consider working with others. For more info, feel free to get in touch.

Who is Behind Mechanism?

Denis Grosz, CEO

Denis has been a founder and operator of consumer web businesses since the late ‘90s; over 1.2 billion people have visited his properties.

In 2010, he became a startup advisor and investor. Bucking the convention of diversified investing, he has taken significant stakes in the following startups:

  1. BestReviews: Co-founder & Board Chairman, 2014 – present
  2. Thumbtack: Investor, Advisor & Board Member, 2010 – present
  3. Apartment List: Investor, Advisor & Board Member, 2010 – present
  4. Autolist: Investor, Advisor & Board Member, 2014 – present
  5. SmartAsset: Investor & Advisor, 2015-present
  6. Udemy: Investor & Advisor, 2014 – present
  7. ConsumerAffairs: Investor & Advisor, 2010 – present
  8. Mitre Media: Investor & Advisor, 2014 – present
  9. Toptal: Investor & Advisor, 2012 – present

Denis launched Mechanism to apply his creativity and expertise in an even deeper way.

Liza Yermakova, Senior Associate

Liza has deep product development experience for the consumer web. She directed operations and product development at Conjecture Corporation. She is a true generalist with a broad array of interests and business experiences.

As a Senior Associate at Mechanism, she is focused on operations and partnerships. Liza has an MBA from Harvard Business School.

Thoughts from Friends of Mechanism

Mechanism Startup Philosophy

More about Mechanism

How does Mechanism compare to traditional employment and traditional entrepreneurship?

Exceptional performers typically have two options: traditional employment and traditional entrepreneurship. Mechanism offers an alternative path that we believe offers better risk-adjusted upside.

Mechanism cofounders get a reasonable salary from the outset and earn a meaningful equity stake in the venture.

How does Mechanism choose cofounders to work with?

We prefer to work with entrepreneurs that are referred though our network but are open to considering others. The process begins with a brief call followed by a series of lengthy in-person sessions. If selected, the entrepreneur may be offered a paid month to explore an idea - this period allows us the chance to work with each other and to deeply explore ideas to pursue. Both parties can part ways at the end of the month or opt to dive in.

We work with ambitious, proven performers that have the resilience to drive a business to success. Cofounders with any of the following backgrounds are likely to be suitable candidates:

  1. Entrepreneurs (from failed and successful ventures)
  2. Startup execs / early-employees
  3. Entrepreneurs considering starting a search fund
  4. MBA grads
  5. Management consultants
  6. Xooglers, etc.
  7. Investment bankers, PE, etc.

At the moment, only US citizens are considered. We are closely following new legislation and may open this up to international entrepreneurs if it becomes feasible.

Is startup experience required to become a Mechanism cofounder?

Experience working in a startup is preferred but not required. The cofounder candidate must have a strong track record of execution, drive and resilience to be considered.

How does Mechanism decide which business ideas to pursue?

Finding an idea that resonates with the entrepreneur and one that has a clear path to profitability takes some research and industry expertise. The process typically takes weeks but not months. We are happy to work with entrepreneurs with and without ideas. We are open to working with entrepreneurs who are already excited about a particular idea, as long as it offers a clear path to profitability and has significant upside thereafter.

Where are you located?

San Francisco. In most circumstances, cofounders are required to move to San Francisco.

Do you accept pre-existing teams?

Generally not, but we may make exceptions to this.

How much do you invest when starting a new Mechanism venture?

We provide a fixed amount of capital that should be more than enough to prove out most business models. The fixed amount serves as a powerful forcing function that requires focus on what is important.

How does Mechanism’s model compare to a search fund?

Our model has some similarities to search funds, but it has several critical differences. A Mechanism cofounder gets started as CEO right out of the gate; there is no need to raise capital (~3 months) or search for a business to acquire (~1.5 years). Since the venture is started from scratch, there are no legacy issues to deal with.

How do I get more information?

Feel free to get in touch.