Goldman Sachs ’head of consumer finance, Omer Ismail, and one of its chief executives, David Stark, are both set to embark on a start-up venture backed by Walmart and Ribbit Capital.
Employers represent a major step in the world’s second largest retailer of financial services, after it abandoned its plan to start a bank a decade ago. , under pressure from regulators.
Walmart and Ribbit have not provided much information about the start-up business, which was announced in January, but said it would “deliver technology-driven financial experiences tailored to customers and customers. -Walding Fellowship. “Most will be owned by the retailer, and the companies said“ growth could come through partnerships and construction. ”
Ismail was tapped to lead Goldman’s customer division, known as Marcus, less than six months ago, taking over from founding head Harit Talwar. Goldman has been a graduate of Dartmouth College and Harvard Business School, Ismail since 2002. Stark, a Goldman partner who has been with Marcus since its inception nearly five years ago, has been appointed head of com- recent partnerships at the unit. He was instrumental in establishing the credit card partnership with Apple.
In 2020, Marcus generated just under $ 1.2bn in revenue, up 40 percent from 2019, just a small fraction of Goldman’s total. $ 8bn of loans were outstanding at the end of the year, split between credit card loans and installments, to go with $ 97bn in investments.
Ribbit Capital is a major backbone of Robinhood. He handed over $ 500m in adjustable debt financing to the stock trading platform when it had to increase its capital buffers with Gamestop and other “meme” stocks trading at an unusual level. of sizes and among wild price volatility. Ribbit, founded in 2012, is led by Venezuelan venture capitalist Micky Malka.
Goldman Sachs said in a statement that Marcus “has a real drive and a growing mountain of talent. We wish these two every success. “Walmart did not respond to a request for comment.
Walmart had tried to set up a bank after the turn of the century, but withdrew its application for a U.S. bank card in 2007, after opposition from the Federal Investment Insurance Association.
Non-bank companies are generally prohibited from being banks in the US. But Walmart had applied for a corporate business loan card, a special banking license that allows certain corporations, such as car manufacturers, to lend to their customers. Walmart’s business was strongly opposed to Walmart’s claim.
Another regulator, the Office of the Currency Regulator, had recently proposed a lightweight bank card for fintech companies that do not accept deposits. That suggestion, too, has been immediately opposed by bank lobbyists.
Ed Mills, policy analyst at broker Raymond James, said: “The interesting thing is that the banks have spent the last 15 years fighting Walmart getting a bank card, but what has changed is that Walmart is the biggest threat to the banking industry – tech and fintech. They spent so much time winning that battle, but did they lose the war? ”