How Goldman Sachs brought Marcus to the UK using AWS

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Historic American investment bank Goldman Sachs says it was able to launch its Marcus online savings product in the UK in 11 months, a timeframe that would have been "unthinkable" without the help of public cloud partner Amazon Web Services (AWS).

Speaking at the AWS Financial Services Cloud Symposium in London today, Jo Hannaford, partner in engineering at Goldman Sachs, explained how "through the Marcus platform, we are building completely new business platforms, and we're building those platforms completely in the cloud."

Launched in the UK in September 2018 and named after one of the original founders of the bank, Marcus is Goldman Sachs' online-only savings product for consumer customers which offers a highly competitive 1.5% interest rate and promises to charge no hidden fees. The service passed 250,000 UK users with £8 billion in deposits or savings in May this year, according to Yahoo Finance.

Marcus is underpinned by AWS public cloud infrastructure and services and is also being used as a test bed for cultural change within the bank's population of 11,000 developers.

Hannaford said that Goldman Sachs implemented the Marcus platform in the UK "end-to-end in 11 months", an achievement that would have been "unthinkable for us to do that when we have to provision our own hardware. It would take us five months to get the hardware, from ordering and provisioning and installation, all of that will be so hard to do."

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Hannaford described AWS as the bank's "predominant partner for cloud provision" and the links between the two companies became even more deeply entrenched earlier this month when former AWS executive Marco Argenti jumped ship to join Goldman as partner and co-chief information officer. The bank has also recently partnered with Apple to underpin the Cupertino-based company's first foray into financial services with the Apple Card.

Key considerations

Scalability and resiliency were naturally the key factors at play when Goldman Sachs decided to opt for AWS to launch this new service.

"For decades we have been very familiar with the closed infrastructure that trading provides. If you think about a trading environment, whether it's equities or any of those environments, it's in many respects a very closed loop," she explained. "We're very used to dealing with market volatility, but the number of participants in that market are pretty much fixed at any one time."

She compares this IT heritage with entering a consumer market for the first time, where the bank couldn't predict with any degree of certainty how much the Marcus proposition would resonate with the UK public.

"We didn't know how the UK public are going to react to that business," she said. The bank had war-gamed for a certain level of initial account openings, but Hannaford "multiplied it by 600, and I'm really glad I did, because in the first hour we actually had 600 times more customers than we had anticipated. I don't think if we had built with anything other than a cloud provider like AWS, we would have been able to scale," she said.

Then, on resiliency, the bank had to establish a platform that would meet not just customer expectations, but those that are due to be published by the Bank of England in the upcoming update to its expectations for operational resiliency for UK financial services providers.

"Don't get me wrong, electronic trading has to be resilient, but it is a different type of resiliency, and the requirements are very different," she said. "So the global infrastructure platform that AWS provides, the automatic failover capabilities, the fact it is seamless – all of that is very attractive to us.

"We're also very conscious that the Bank of England is in the process of publishing their expectations on operational resiliency, and they are extensive. I'm sure many of you, like us, have just gone through an exercise where we had to estimate how much it would cost us to implement that. A big part of those factors, their expectations on operational resiliency that is, a big part of our factors is going to be the relationship that we have cloud providers."

One example of this relationship that Hannaford gave was a conversation she recently had with AWS around a new, unnamed, business the bank is planning to launch in the UK next year.

"Last week I had an in depth conversation with AWS and the developers about the type of queue technology they were using," she said. "We would never, ever have had that type of discussion at that level before, so if you think about scaling that across 8,000 applications and 11,000 engineers, that is a very interesting dichotomy for us."

Culture change

The use of public cloud services through AWS has certainly turned some heads at the top of the bank. "For our business heads, that pushed them to think about us as being able to deliver in the timeframes that you would expect from Silicon Valley. And I mention Silicon Valley because that's their perception of innovation," she said.

After the success of the Marcus launch, Goldman Sachs is keen to start coalescing all of its 11,000 engineers around a shared set of tools and processes.

"Now, I think one of the biggest challenges that we faced as an organisation as we embarked on this journey, and we just this year celebrated 150 years, is that we need to really think about some of these cultural implications for our software engineering organisation," she said.

"One of the benefits to achieve is to be able to act absolutely consistently, to make sure that when we're developing applications in the future, they're done in exactly the same way and understand where those differences are, and to be able to kind of communicate to ourselves at senior levels why we're comfortable with those differences. I think that's a key part culturally, which is actually very difficult for us."

Hannaford went on to detail how she sells in cloud investment to her senior management team.

"I talk about the opportunities to increase our revenue like Marcus, I talk about longer-term cost reduction, I talk about that in a way which is more about scaling our platforms," she said.

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