Basically, you should do the Academy as well as possible, scoring excellent in everything. You'll net 1500 renown for that. After that, head for the seas.
Renown works in many ways. Unspent renown gets you to better boats faster, so upgrading your Type II to the roof is not really smart. Self-evidently. renown also grants you the upgrades but it also is the 'money' spent on the repairs of your boat. Never, ever hit neutrals or friendlies 'cause their renown is deducted from your tally and sinking them often enough will stop your career. Your personal rank or medals don't matter in getting to new boats/equipment. Unspent renown is the key. But don't go crazy with it: if you think something's worth it, get it. I'm on my 22nd patrol in IXB and have almost 30 000 renown in the pocket though the boat has everything I need.
The crew likes to see you sink stuff
Every sunk ship or destroyed plane will affect their efficiency rating, so better you do, the more they like you= the better they get. In other words, renown is your 'currency' and targets destroyed is good for your crew. I'm not sure whether missed shots or taking damage affects negative your crew.
Also, the higher the realism settings, more renown you get (of ships net value).