Goldman Sachs pivot from Marcus shows that disrupting retail banking is hard

David Solomon, Goldman Sachs, at Marcus event

Goldman Sachs CEO David Solomon is reining in his ambition to make the 153-year-old investment bank a major player in US consumer banking.

After product delays, executive turnover, branding confusion, regulatory missteps and deepening financial losses, Solomon on Tuesday said the firm was pivoting away from its previous strategy of building a full-scale digital bank.

Now, rather than “seeking to acquire customers on a mass scale” for the business, Goldman will instead focus on the Marcus customers it already has, while aiming to market fintech products through the bank’s workplace and wealth management channels, Solomon said.

The moment is a humbling one for Solomon, who is devoted to the possibilities within the nascent consumer business after becoming CEO four years ago.

Goldman started Marcus in 2016, named after one of the bank’s cofounders, to help it diversify revenue away from the bank’s core trading and advisory operations. Big retail banks including JPMorgan Chase and Bank of America enjoy higher valuations than Wall Street-centric Goldman.

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