Goldman Sachs's floundering consumer ambitions
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On Monday, roboadvisor Betterment announced that it had reached an agreement with Goldman Sachs to acquire Goldman’s Marcus Invest digital investment accounts. Betterment is slated to take over those accounts by the end of Q2, with Marcus Invest customers having the option to opt out of the transfer before that deadline.
According to the release, Betterment already manages $45B in assets for 850,000 customers.
“This acquisition further cements our leadership in the digital investing space,” said Sarah Levy, Betterment’s CEO. “We are excited to welcome these customers to Betterment where our scalable technology platform will continue to support them on their investing journeys.”
To Marcos Rosenberg, Global Head of Goldman Sachs Marcus, the decision stemmed from a desire to "increase our focus on our growing Marcus Deposits platform.”
“We made the decision to transition away from our digital investment advisor offering and wanted to find a great home for those customers," Rosenberg said.
The act of jettisoning Marcus Invest customers has been at least a year in the making, with it becoming increasingly clear following the retail-investor boom that Goldman Sachs was too late to the party.
This latest move, in addition to the bank’s rocky exit from its Apple Card partnership, makes it clear that Goldman’s retail-focused aspirations continue to dwindle. While Rosenberg frames the decision to focus on Marcus Deposits as a strategy designed to help Goldman Sachs “focus” on its strengths, the “focus” reframing seems to go far beyond one sub-vertical. It symbolizes Goldman’s virtually wholesale abandonment of retail-focused services and a return to its traditional high-net-worth roots.
For fintechs: What does it mean if a behemoth like Goldman Sachs can’t handle consumer-focused banking and wealth management services simultaneously? It suggests that fintechs may continue to possess the ability to capture market share through their agility. It may also mean that, as other banks attempt in-house initiatives like Goldman’s, fintechs have an opportunity to acquire the customers these banks eventually abandon.
