Goldman Sachs: Leveraging AI and APIs to Serve Business and Clients
For over a century, Goldman Sachs has been one of the most recognizable names in multinational investment banking and financial services. When they speak, the market listens.
So what does Goldman Sachs have to say about APIs and AI when it comes to serving its clients and fueling business success? Kong had a chance to ask these questions to Rohan Deshpande, Managing Director at the company, at API Summit 2024.
If you’re managing APIs for a tech team in the finance industry, don’t miss the insights and advice revealed below.
The importance of engineering and APIs at Goldman Sachs
Goldman Sachs has had phenomenal success serving its clients, but behind the scenes, engineering plays a huge part in the organization’s operations.
"Engineering at Goldman Sachs is a strategic investment for the firm," Deshpande said. "About a quarter of the people that work for Goldman Sachs are part of engineering."
Being client-focused is one of Goldman Sachs’ operating principles, so Deshpande points out that technology is an enabler for understanding what customers are trying to do, how the organization can support them, and how technology can make things more efficient.
As Managing Director, Deshpande works within Goldman’s core engineering organization, the foundational group that builds technology for the rest of the firm.
Deshpande's team builds platforms that are used by engineers across the firm to solve business-specific problems. APIs, therefore, are key to keeping things efficient and frictionless.
"APIs are a first-class construct at Goldman Sachs," Deshpande said. "They are the perfect abstraction that gives you decoupling between technology products as well as different teams."
The engineering and business sides of the house have to have close collaboration and shared responsibility. Deshpande's team is responsible for the infrastructure, while business teams own the responsibility of delivering applications that serve client needs. It’s a relationship that turns engineers into first-class citizens within a bank and drives innovation across the organization.
"We’re a bank, and because we’re regulated, we have compliance requirements from regulatory agencies," Deshpande said. "Instead of having tens of thousands of engineers implement these as they build applications, my team builds them out at the platform level."
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How Goldman Sachs is using APIs — and Kong
Deshpande says Goldman Sachs has been API-first for over a decade now. What sorts of success stories have come from that API-first culture, and how is Kong helping enable them?
"The way I look at APIs, they’re a necessary layer between different teams, businesses, and organizations. An API gives you a strict contract that lets you know a service is going to operate a certain way with a certain set of inputs,” Deshpande said.
That setup and decoupling enable every part of the business to move at its own velocity, he pointed out. The team consuming info from APIs can keep moving and building at the velocity they need, while the team operating the API can iterate, implement it, and scale it as they see fit.
"For a firm like Goldman Sachs, where we have tens of thousands of engineers, we can have teams that operate in a decoupled manner. They can evolve their applications the way they see fit. It frees them to move at their own pace," Deshpande said. "Where Kong and the API platform come in is we get to implement necessary capabilities through the platform layer itself. Instead of every team implementing these principles from scratch, we can offer them through the platform. I think that’s a really killer feature."
The uses for APIs at Goldman Sachs extend through client-facing applications as well as internal business operations. Deshpande said the firm has a developer portal with an entire inventory of products clients can consume via APIs. These enable transaction banking across different institutions that leverage the highly developed expertise Goldman Sachs has nurtured over the years.
"The thing you have to realize about a business like Goldman Sachs is it’s not about the volume of the APIs. It’s the value per call. Every API has very significant value," Deshpande said. "It’s a different mindset when it comes to operating APIs at a bank or regulated institution."
Deshpande said an internal app for all of Goldman Sachs leadership that surfaces data from over 100 internal sources and presents it in an easily consumable manner. “The people that use it love it because they don’t have to go to 100 different places to find the data."
Externally, Goldman’s developer portal and public APIs serve as a distribution channel driving new business and new revenue. Internally, the API platform Deshpande's team manages helps accelerate developer productivity and empowers them to build apps faster. The firm’s use of an API platform and Kong ensure both sides keep moving without having to worry about the infrastructure itself, a killer feature according to Deshpande.
Challenges of dealing with APIs in the finance industry
Finance is a very highly regulated industry, so how does that play into the mindset for Deshpande's team when it comes to technology and API platforms?
"It’s a different kind of opportunity, and you’re operating under a different set of constraints," Deshpande said. "For us, it’s absolutely essential that we are operating APIs in a very secure, compliant manner because ultimately it’s all about client focus for us."
Goldman Sachs has a very high set of standards in order to fulfill its client-first operations, so they want to ensure their APIs operate with those standards in mind.
"Things like authentication, authorization, rate limiting, input validation, quota management — these are non-negotiable for us when it comes to APIs, especially at the scale at which Goldman Sachs operates," Deshpande said. "We leverage Kong plugins in order to implement these capabilities, and we package them to the business teams as either an SDK or as a service. When they build applications, they know they’re signed off, vetted, approved, and compliant with the standards we have at the firm."
Even in a highly regulated space like finance, Deshpande's team — and Kong — have enabled developers to build on behalf of the business and make it as friction-free and effortless as possible. The dependability and trust that come from that setup have been a game-changer according to Deshpande.
AI and APIs moving forward in the finance industry
We're seeing a big shift in the value of APIs as AI and GenAI emerge. Traditionally, APIs have helped provide the data behind UIs. But when you think about the experiences and services produced by AI and GenAI, there’s no UI needed — just an API. It sets up a shift in thinking for many developers, one that puts more importance than ever on APIs as the future of this technology evolves.
"Goldman Sachs has a long history of innovation. The firm has been around for 150 years," Deshpande said, adding that they’ve been doing work with machine learning and AI for quite a while already.
The first areas of focus they have for AI and GenAI will be around enabling the client experience and driving even higher efficiency through those mechanisms. For now, Deshpande notes that what’s key is that they’re exploring in safe, controlled manners that adhere to their engineering tenets and business principles.
"Having an API in front of whatever model you’re using is actually essential because it gives you really nice abstraction, especially as these models are evolving and changing," Deshpande said.
However firms experiment with AI — closed source models, open source, hosted, etc. — you can put them behind your API, then keep building out an application without having to worry about application behaviors changing as much. If you’re using an AI model, you want to ensure it’s being used appropriately, Deshpande said, one that’s within the bounds of the business case. That’s where an API is very helpful.
"You want to control access to the model, do it through an API," Deshpande said. "I think the API construct is very coupled with how these LLMs and models are going to be used going forward."
Looking to unlock the power of APIs and AI in your organization? Explore more customer stories on the blog or watch Kong customer sessions from API Summit 2024.
