New banks

‘We had the audacity to think big and execute on that bold vision’: Goldman Sachs internal memo includes interview with outgoing head of consumer business, Harit Talwar

  • Harit Talwar built Goldman's consumer banking business.
  • Now, as he transitions out of the role, he looks back on how GS transformed itself.
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‘We had the audacity to think big and execute on that bold vision’: Goldman Sachs internal memo includes interview with outgoing head of consumer business, Harit Talwar

Digital transformation is a fluid and long process for a traditional financial institution. More than any other bank its size, Goldman Sachs has reinvented itself over the past five years. Goldman’s trading floor in the 1990s wouldn’t recognize the firm’s new participation in Apple Card, its new installment loans with JetBlue, and its SMB lending activity with Amazon and Walmart.com.

Harit Talwar, head of the bank’s consumer business, was instrumental in remaking the firm’s entrance into consumer and retail banking. Last week, it was announced that Talwar is stepping aside amid a restructuring of the firm’s business that further aligns the new businesses.

Tearsheet has an internal memo that includes an interview with Talwar about his experiences building Marcus and remaking Goldman Sachs. The following is the complete text of the Q&A with Harit Talwar.

Looking back over the last five years, what were you thinking then and what are you thinking today?

Harit Talwar: The thing I am most delighted about is that I actually joined Goldman Sachs to build this Consumer business. I was happy at Discover and had no intention of leaving. I wasn’t sure if the firm was committed to building a consumer franchise because building new businesses can be messy and expensive. And frankly I wasn’t sure whether I would like the culture, so I refused to take any calls. Fortunately for me, the firm tracked me down at a dinner in DC and within six weeks of that dinner, I had joined. 

I joined because during the interview process itself, I fell in love with what I perceived to be the culture of Goldman Sachs. We’re not perfect, but we truly embody the spirit of One Goldman Sachs and believe in team work, excellence, and building an environment where the people bring the best of themselves to work every day. 

Also, I felt that Goldman Sachs had a real advantage to innovate how financial services can be distributed in a modern, digital way while meaningfully extending the franchise. After all, this is one of the best known financial services firms with no existing consumer business at the time. 

Looking back, all of this came true – I couldn’t have imagined all we would accomplish together.  

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What are you most proud of accomplishing in your time here?

Harit Talwar: It’s simple, we built a modern consumer business inside a 150-year-old bank. There are not many instances of that, and it demonstrates Goldman Sachs’ ability to innovate and create platforms at scale. 

Together as a team, we entered a new customer segment for Goldman Sachs, built new products, assembled new talent both from both within and outside the firm, and created a new modern digital platform. 

I’m also proud that we meaningfully extended the Goldman Sachs brand. The firm has arguably the best brand in financial services, and we have extended that to millions of mass affluent consumers. Our research shows that people who know about Marcus have a more favorable opinion of Goldman Sachs by 20 points. 

All in all, we had the audacity to think big and execute on that bold vision.  

It couldn’t have been easy. What are lessons that you learned in building a business?

Harit Talwar: There are many, but I’ll highlight four: 

First, it reminds me of that song in the Sound of Music, “When you read you begin with ABC When you sing you begin with Do Re Mi.” Well when you build a business, you begin with the customer – the north star of the business has to be addressing customer problems. As you know, even before launch, we spoke to more than 10,000 consumers to understand their pain points and how we can address them. We’ve used data, design, and engineering, along with competencies in risk management, marketing, operations, etc. – but the real magic is bringing all those capabilities together to make things simple, transparent, and valuable for consumers. 

Second, there will be challenges, obstacles, and “crisis.” The only way to not have problems is to not do anything. What I’ve learned in the last five years is that building modern businesses is not an opera, but a flash mob. In the opera you have a conductor who is directing talented individuals and they are all obediently listening. In a flash mob, you have talented dancers with a north star who come together in an agile way to build, innovate, and deliver more with every step. There is infectious energy and belief in what you are doing. And you know what – crisis management can be a great tool too. During the build phase, it seemed as if there was a crisis every week, and then we realized that as long as the crisis is new, it’s just a reflection of the progress you are making. Of course, you shouldn’t have the same crisis every week! As David Solomon says, progress, not perfection. 

Third, in today’s world, speed and therefore engineering architectural choices matter. You’ve got to achieve both building platforms at scale and having the ability to enhance them every few days. It’s not easy. 

Fourth, it’s a fundamental truth – people matter. The combination of talent, culture, and your operating model can be the strongest competitive moat. Building Marcus inside Goldman Sachs has been a big advantage when it comes to attracting diverse and top talent. 

Apprenticeship and mentoring culture across the organization matters. For example, I have been fortunate that when I left Citi, Discover, and now Goldman Sachs, the person taking over from me in all three instances was an important member of the leadership team. 

What have you learned personally during your five years at Goldman Sachs?

Harit Talwar: This is the world’s best firm because of its people, culture, commitment to execution excellence, and risk management. The talent is deep, the work ethic is strong, and the teamwork is remarkable. And when we make mistakes, we are open, honest, and run towards solving problems, rather than shirking responsibility. 

For example, in the third quarter of 2018, we had a minor hiccup in consumer lending credit quality. In true Goldman spirit, we were transparent and moved swiftly. Today, we’re benefiting from the strong credit quality in our lending portfolio as we navigate the credit cycle.  

The Consumer business is still in its earliest days. What does the future look like?

Harit Talwar: It’s clear the future of consumer financial services is extreme customer centricity. Building platform that make customers lives easier across products and channels is the goal. 

I’m proud and delighted that Omer [Ismail] will lead the business into its next chapter. From day 1, I have relied on him not just for his tireless work and commitment, but more importantly for his insights and friendship. 

I’m sure five years from now the business will look different with more products, more customers, and more partnerships, but what will not change is the commitment to customer-centricity.

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