GS Goldman Sachs Group Inc

Chavez oversaw the firm's push to digitize and move more client interactions onto apps

By Liz Hoffman 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (September 4, 2019).

Martin Chavez began planning his escape from Wall Street in January.

Weary of the New York winter, the Goldman Sachs Group Inc. trading executive retreated to his vacation home in the Berkshires, bought a white board at Target and sketched out his next chapter, named in order of his priorities: Operation Kids, Freedom & Sunshine.

The 55-year-old is retiring from Goldman and moving to California, where he plans to spend more time with his two young children and teach a course at Stanford University. He joined the firm as a young computer programmer 26 years ago.

Mr. Chavez was once seen as a future chief executive candidate, and his ascension up Goldman's ranks -- a gay, tattooed, Latino techie who became the face of a new breed of nerds ruling Wall Street -- was a sign of changes across the financial industry.

"I tell people if your top priority is your career on Wall Street, I think that's interesting and I support you and I don't want to hang out with you," Mr. Chavez said in an interview. "My top priority is peace of mind. No. 2 is my kids. No. 3 was Goldman Sachs."

Mr. Chavez joined the firm in 1993 as a coder in its commodities-trading arm, building mathematical models for senior traders. He was the fourth employee in a skunk works group of engineers that built Goldman's risk-management and trading database, SecDB.

Mr. Chavez was in some ways emblematic of a new, cooler Goldman. He left the firm in 1997, founded and sold a tech startup, and returned in 2005 after spending a week at a New Mexico monastery considering the offer.

In 2013, he was put in charge of Goldman's engineering department. On his watch, the department grew to almost 10,000 people, a quarter of the firm's head count.

He was a favorite of then-CEO Lloyd Blankfein, who promoted him to finance chief in 2017. But the job never quite fit. Mr. Chavez struggled on investor calls and was the public face when the bank nearly flunked a government stress test.

"I'm sure it was amazing preparation for something," Mr. Chavez said Tuesday. "One day I'll figure out what that is."

Under new CEO David Solomon, he returned last year to the trading division, where he has overseen Goldman's push to digitize the business, cut costs and move more of its client interactions onto apps and other electronic pipelines.

Big banks are leaning heavily on coders as more trading goes electronic, and Mr. Chavez has been a champion of Goldman's push to open up its internal technology to clients. The firm is building a subscription-based trading app called Marquee; an early version of the app was dubbed "Marty" in Mr. Chavez's honor. A restructuring earlier this year moved 6,000 engineers into the trading division.

Marc Nachmann, a senior investment-banking executive, will succeed Mr. Chavez. Mr. Nachmann came up raising money and designing derivatives for Goldman's commodities clients and is known as a wonkish insiderwith risk-management expertise.

The handover comes during a critical spell for Goldman's trading business. Postcrisis regulations and calm markets have cut its trading revenue 60% since 2009. It has been courting corporate clients and asset managers, while accommodating client preferences that have shifted to simpler products.

Mr. Chavez, who is close to former Google CEO Eric Schmidt and investor Jim Breyer, said he will teach a course at Stanford on "how software ate finance" and is weighing jobs in venture capital. He said he is interested in whether the same digitization that shook up finance can be applied to health care.

"The transformation of finance through software is about making money programmable," he said. "The next frontier is making life -- genes, cells, organs -- programmable."

And Mr. Chavez, who grew up in Albuquerque, N.M., said he plans to spend time in the sun. "My friend [famed venture capitalist] Peter Thiel asked me, 'When are you going to stop talking about moving to Los Angeles and move to Los Angeles?'"

Write to Liz Hoffman at liz.hoffman@wsj.com

(END) Dow Jones Newswires

September 04, 2019 02:47 ET (06:47 GMT)

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