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Goldman is getting out of the robo-advisory business

Goldman Sachs (GS) is getting out of the robo-advisory business as it tries to scale back ambitions for parts of its enterprise and refocus on core strengths.

The Wall Street giant said Monday that it had reached an agreement to sell its Marcus Invest digital investing accounts to digital investment adviser Betterment.

Marcus Invest is an algorithm-driven investment advisory business that was launched in 2021 as Goldman sought to market more affordable services to the mass affluent.

Now CEO David Solomon is leading a sweeping retreat from a variety of consumer offerings while focusing the firm on its core strengths of trading, asset management, and investment banking.

Goldman Sachs chairman and CEO David Solomon speaks during Goldman Sachs analyst impact fund competition at Goldman Sachs Headquarters in New York City, U.S., November 14, 2023. REUTERS/Brendan McDermid
Goldman Sachs CEO David Solomon. REUTERS/Brendan McDermid (REUTERS / Reuters)

Last August, it announced it found a buyer for a personal finance unit catering to the mass affluent. Then in early October, it announced the sale of specialty lender GreenSky to Sixth Street Partners and a consortium of other firms.

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It is also looking for a way to shed its credit card partnership with General Motors (GM). It still has another credit card partnership with Apple (AAPL).

Profits at Goldman rose 28% in the first quarter as investment banking revenues surged, giving Solomon some needed momentum at the start of 2024.

Goldman’s stock rose nearly 3% Monday as of the early afternoon. Year to date, it has climbed more than 8%, outperforming a US banking sector-wide index (^BKX).

"We feel very good about our first quarter results," Solomon told analysts last week. "This performance was aided by the swift actions we took last year to narrow our strategic focus and play to our core strengths."

The Marcus Invest accounts are expected to move to Betterment's platform on or about June 29.

It said it is not abandoning a Marcus Deposits business that includes savings and certificates of deposit accounts.

Read more: 10 best free checking accounts of April 2024

"As we increase our focus on our growing Marcus Deposits platform, we made the decision to transition away from our digital investment advisor offering,” Marcos Rosenberg, global head of Goldman Sachs Marcus, said in the release.

"Betterment was the obvious choice for those accounts,” Rosenberg added.

David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance.

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