Goldman Sachs (GS) is famous not only for being one of the oldest, most prestigious, and most important investment banks on Earth, but also for its significant institutional and indeed political power in America and abroad. Sometimes this results in some embarrassing news, sometimes it manifests in connections to high profile corruption cases, and sometimes it results in the company having access to opportunities others do not. But in all cases, its power translates into massive opportunities for its workers and alumni, who often find themselves in some of the most lucrative positions in top institutions around the world.
It’s no surprise, then, that many budding bankers are eager to get into Goldman above all other banks. That said, such a move isn’t easy; the bank is very picky when it comes to applicants and demanding when those applicants get hired. Tales of 16-hour days and a grueling work culture aren’t enough to keep the most ambitious away, so how can they leverage the bank’s new structure?
An important but under-discussed development at GS is its new corporate structure. The new Goldman now has three divisions, one for investment banking, one for asset and wealth management, and one for transaction banking.
These divisions aren’t very clean-cut, as financial operations are always interconnected. Thus, the investment banking division also includes its asset trading business, meaning its desks of traders are now part of the investment banking division that, historically, has focused on creating entirely new business by identifying lucrative corporate actions (IPOs, mergers and acquisitions, debt issuances) and either underwriting or structuring those. Traders may be the most recognizable part of finance—those men and women at their Bloomberg terminals executing trades for clients with cutting edge technology—but they aren’t the biggest or most important part of the industry, and their connection to traditional investment banking operations is tenuous at best.
Similarly, the asset and wealth management division, which looks on its surface like a kind of private banking where bankers foster close relationships with High Net Worth people (HNWs) so that they can manage their portfolios for a set fee, also has a consumer-banking arm where it does things like work with retail bank customers on things like credit cards.
The third part is perhaps the most unwieldy, although not the largest. With transaction banking including fintech ventures and the company’s partnership with Apple (AAPL) on that company’s credit card, there’s significant overlap with the asset/wealth management division and a lack of clarity about how those various operations work with one another.
There’s also not much publicly stated about how these three branches will work with one another, let alone how their internal structures are set up. But it does point to Goldman’s perception of the world’s financial needs: there are investment needs for companies, there are asset/wealth management needs for rich people, and there are transactional features for everyone else.
The skills needed to thrive in these divisions will surely differ, and the opportunities will be vastly different as well. This means that anyone with ambitions to go to Goldman now needs to be a bit more specific. Do they want to be an investment banker, whipping up prospectuses and proposals for projects that will most likely never come to fruition? Do they want to be an asset manager, holding wealthy clients’ hands and urging them not to sell during short-term periods of volatility? Or do they want to put their data science skills to the test and deal with the trillions of data points in one of Goldman’s fintech ventures?
One of these paths might be ideal for you—the others maybe not so much. Which is why if you get an offer at Goldman, it’s no longer enough to be ecstatic about your future of wealth and glory. Now you need to ask: exactly which Goldman are you getting into?