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Consumer banking and Transaction banking are competing for favour.

Battle of the Banks at Goldman Sachs: Marcus vs TxB

Last week, Goldman Sachs released its partner list. Among the names was a man controlling one of Goldman's most successful technical initiatives: Luc Teboul, head of technology at the transaction banking division, TxB.

Teboul joined Goldman from JPMorgan in 2018. He has since hired over 400 engineers into TxB, spread between New-York, Dallas, London, Singapore and Bangalore.

Also on the list was John Fathers, the man who until earlier this year was head of technology at Marcus, Goldman's consumer division. Fathers is now in Goldman's wealth management division having been replaced in February by Ilya Gaysinskiy, an existing Goldman partner. 

That both Teboul and Marcus's former head of technology made the list might suggest both technology platforms are equally feted, but that is not the exact truth. Marcus may have served “over 15 million customers and generated more than $2.2 billion in revenues in the last 12 months,” according to CEO David Solomon in the Q3 earnings call this year, but costs are mounting. TxB is the real golden child.

Marcus's fall from favor coincides with accusations that it's simply Solomon's passion project.  With estimated losses of $1.2bn this year, Marcus is on the back foot. Solomon, however, is still a believer and has likened criticism of Goldman's retail bank to that faced by Amazon Web Services in its early years. 

The fundamental problem is that Marcus is hemorrhaging money, and although future losses at the unit may be obfuscated by integration with the wealth management division, this is unlikely to change. TxB, however, is in the sweet spot of payments processing and transaction banking. It's one of the flagship segments of Goldman's new 'Platform Solutions division' and is being rolled out globally. In a recent blog posted on Goldman's site, Teboul said TxB has been hiring 10 people a month on average.

Inside Marcus at Goldman Sachs

The technology behind Marcus is supposedly very good, yet that is both its blessing and its curse. The tech stack has been built from the ground up. This is great if you're an employee working with cutting edge technology, but has contributed to the project's expense. 

As for the work-life balance, employees on Blind desribe working for Marcus as like being “on call 24/7”. They also allege a work culture that entails 12–14-hour days. This might explain the various high level departures in recent years.

Inside TxB at Goldman Sachs

The technology behind TxB appears to be just as up-to-scratch as Marcus. Though it lacks the proprietary technology of the consumer bank, TxB uses a modern cloud native stack for which it received industry acclaim when they won a 2021 Banking Tech Award for best use of cloud.

However, there are conflicting reports on TxB's culture. Some employees on Blind echo the issues voiced by those at Marcus, with claims that “TxB has one of the worst WLB for engineering” within Goldman. Others, while not posting a glowing review, state that the simple quality of the tech stack makes the amount of work at TxB bearable.

TxB is arguably the place to be out of the two platforms. While both boast impressive technology, Marcus’ losses create a sense of uncertainty that TxB doesn’t have. Nonetheless, Marcus has its internal champions. If a lack of legacy systems and innovative work are a source of excitement for you, Goldman's consumer bank might be the way… However, this presumes that you can get an offer: Goldman Sachs didn't comment for this article, but there are unconfirmed reports of a Marcus hiring freeze.

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Photo credit: eFinancialCareers/Dall-e

AUTHORAlex McMurray

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