Summary List Placement
Goldman Sachs launched its consumer-banking arm five years ago with a marketing blitz and much fanfare, sending a strong signal to Wall Street that it wanted to disrupt retail banking — and reshape its own future.
Since then the bank has built it into a $1 billion business by standing up new technologies at breakneck speed.
But now Marcus staffers are quitting in droves at the precise moment the bank needs them most, just as it announced a slew of ambitious products and reshuffled its corporate structure to focus on growth. Former employees, as well as banking consultants and an analyst briefed by Insider, said the exodus raises questions about Goldman’s ability to drive its people hard and still compete with Main Street banks.
Simultaneous product sprints wore out employees during the coronavirus pandemic, when they were already feeling an erosion of work-life balance, all while Goldman’s top-down management style infiltrated a unit deliberately set up to avoid Wall Street hierarchies. Nearly every significant leader in the business walked out the door.
Add it up and it’s exposed a cultural breakdown inside what was once seen as a rare success story, an exception to the notion that says a 150-year-old institution such as Goldman couldn’t innovate as nimbly as the technology startups nipping at its heels. Insider spoke with half a dozen people connected to Marcus — both current and former employees — who spoke on condition of anonymity so that they could speak freely without fear of retribution.
Goldman, which leads in more traditional Wall Street pursuits like M&A advice and trading, has staked part of its growth on cozying up to consumers, and it has plowed billions of dollars into the venture, a costly bet on a unit whose success is far from guaranteed.
“It’s what I would call a spark-plug business,” said Richard Crone, an independent consultant who has closely followed Goldman’s launch of the Apple Card and the toll it’s taken on engineers. “They run them hot so they burn them out.”
An ‘avalanche’ of exits
Marcus, which sits within Goldman’s consumer and wealth-management division, started in 2016. Now it has $100 billion in deposits and $8 billion in loans, and is generating $1 billion in annual revenue.
Engineers — spread across the branded Marcus unit and other partnerships like the Apple Card — make up about 1,000 of the consumer business’ roughly 2,500 employees. One early engineering hire, who left late last year, estimated that Goldman’s consumer business has lost at least a quarter of the engineers involved from Marcus’ beginnings. Goldman disputes that figure.
“The departure estimates are overstated and our business continues to be a magnet for talent,” Andrew Williams, a Goldman Sachs spokesman, said.
Seven or eight people from a different team, known internally as the digital-storefront team and in charge of creating the customer-facing technology that appears as an app or webpage, have left in the past several months, a second former employee said. Those departures — including engineers, designers, and product managers — account for about 15% of a …read more
Source:: Business Insider