Vernon Hill, the Founder and Chairman of Metro Bank, has been a driving force in reinventing the banking industry. He is often credited with transforming American banking through his work at Commerce Bank, a company he turned into one of the largest banks in America with over 15,000 employees. Hill's approach was not just to provide banking services but to create a brand that people were passionate about. He applied the same principles when founding Metro Bank in the UK in 2010, focusing on customer experience and challenging traditional banking models. In his talk at the London Business School, Hill discusses how to create a growth company even in industries that seem to lack growth.

"When I first started in banking, the entire industry was pretty boring and mundane. What we did differently was introduce excitement into the process and inject fun into something that had previously been quite dry," Hill reflected. His philosophy was simple: a business should not only offer a product or service but should create an environment where employees and customers feel equally engaged. "A great business isn't about just offering a product; it's about creating a community, a culture, and a movement that people want to be part of," he added.

Hill began by addressing the challenge of creating growth in a no-growth world. He drew from his experience in starting Commerce Bank, a company built from scratch with a clear mission: to make retail banking exciting, accessible, and customer-focused. Starting with a million and a half dollars and just nine people, Hill’s vision was clear: turn a mundane business like banking into a growth machine. He applied the same philosophy to Metro Bank, making it the first new high street bank in the UK in over 100 years.

“Our theme is how do you create a growth company in a no-growth world?” Hill said, emphasizing the importance of shifting the mindset from a stagnant, traditional business to a growth-oriented one. “There’s a huge opportunity when you focus on the customer and do things differently.” This statement alone sums up Hill’s approach, where he made it clear that it’s not about waiting for the market to grow—it’s about creating growth through innovation, exceptional service, and the ability to do business differently. He added, “In a world where growth is hard to come by, sometimes you have to create your own growth.”

One of the key strategies Hill used to grow Commerce Bank was turning retail banking into a fun, customer-centric business. He created an environment where employees were excited to work, and customers were happy to visit. Hill’s success was based on focusing on service and convenience rather than just high rates or fees. As a result, Commerce Bank grew from a single branch to 500 branches and a market cap of $8.5 billion by the time it was sold. Hill was able to reinvent an industry by understanding that core deposits – the money customers trust the bank with – were the real value drivers, not just loans.

“We created excitement in an industry that had been stale for a long time,” Hill recalled. “Banking doesn’t have to be boring; it can be an exciting business if you focus on people, service, and convenience.” His ability to turn the mundane into something special was central to his success. Rather than focusing on the competition, Hill focused on making the customer experience the best it could be. This mindset, combined with his focus on operational excellence, led to the tremendous growth of Commerce Bank. “If you’re doing the right thing for your customers, they will reward you with their loyalty. That’s how you grow.”

At the heart of Hill’s approach is the idea of creating 'fans' instead of just customers. According to Hill, great businesses are built on passionate customers who are loyal to the brand and bring others into the fold. He shared that a strong customer base, or "fan" base, is essential for sustained growth. Using the example of Apple, Hill emphasized how people are willing to pay a premium for a brand they believe in, not just because the product is functional. This philosophy translated directly to banking, where Hill was able to grow Commerce Bank and later Metro Bank by delivering value that customers could feel emotionally connected to.

“Great businesses have the ability to build fans, not just customers. Fans are people who believe in your brand, your product, and your mission,” Hill explained. “They don’t just come back—they bring their friends with them.” This is how Hill defined success—not in terms of acquiring customers, but in building a tribe of loyal individuals who would always return and spread the word about the bank. This idea of fan-building extends far beyond any traditional marketing techniques and goes straight to creating a business that people genuinely care about.

Branding played a pivotal role in Hill’s success. At Metro Bank, he chose to build a brand that was completely different from the traditional UK banks. Hill emphasized that great brands are not just about a logo or name, but about creating an emotional connection with customers. Metro Bank’s model was based on rethinking how banks deliver service – from being open seven days a week to offering free services like coin-counting machines. The key to Metro Bank’s rapid growth was its ability to create a brand that people were excited about, making it stand out in a crowded market.

“It’s not just about having a name or logo; it’s about creating a brand that people are passionate about. At Metro Bank, we didn’t want to be just another bank; we wanted to be a brand people loved,” Hill stated. “We got the branding right, and the people followed.” His focus on developing a culture where customers were treated as more than just business transactions helped create a lasting emotional connection. Hill’s belief was clear: brand identity is critical to the longevity of a business, especially in competitive sectors like banking.

Executing a strong business model is critical for growth, and Hill was relentless in ensuring that Metro Bank lived up to its promises. He emphasized the importance of having a business model that added real value, a culture that reinforced that model, and the execution of that model at every level. One of the biggest challenges was the cultural shift needed to make Metro Bank different from the rest of the UK’s banks. Hill explained that at Metro, they hire for attitude and train for skills, ensuring that every employee is aligned with the company’s vision and values.

“Execution is key. You can have the best idea in the world, but if you don’t execute it properly, it won’t work. It’s all about the people you hire, the culture you create, and the relentless focus on delivering for your customers,” Hill said. He credited Metro Bank’s success not only to a strong business model but also to the team behind it, pointing out that a great model without great people is a recipe for failure. “You need people who understand the vision, are willing to work hard, and have the passion to bring that vision to life.”

Hill also shared how he focused on building customer loyalty through service innovation. Metro Bank’s service offerings included things like free coin-counting machines and being open seven days a week, which catered to the busy lifestyles of customers. Hill’s approach to retail banking was to make it as customer-friendly as possible, offering services that made customers feel valued. He also believed in creating a culture where employees were empowered to go above and beyond for customers, which helped build long-term relationships and fostered loyalty.

“We didn’t just want customers; we wanted fans. People who felt emotionally connected to the bank and believed in what we were doing,” Hill emphasized. “It’s all about delivering a memorable experience that keeps them coming back.” This was a key differentiator for Metro Bank, allowing it to grow in a market where the competition was steep. Hill’s focus on exceptional service and putting the customer first created lasting bonds between the bank and its clientele.

Building Metro Bank was not without its risks. Hill talked about the challenges of raising money and obtaining a banking license in the UK, especially in the wake of the 2008 financial crisis. He also discussed how different the banking systems in the UK and US were, and how Metro Bank had to innovate and adapt quickly to succeed in a new market. Despite these challenges, Hill’s relentless drive, and focus on execution, allowed Metro Bank to thrive in a competitive market.

“The hardest part is always the beginning. Raising money, getting the license, and proving that it will work. But you have to believe in your vision and stick with it,” Hill said, reflecting on the struggles he faced when starting Metro Bank. “If you don’t believe in your model, nobody else will.” This unwavering belief in his model and vision was crucial to his success. Hill’s story demonstrates how perseverance and the willingness to take calculated risks can lead to immense rewards.

In conclusion, Vernon Hill’s talk at the London Business School was a masterclass in creating a growth company in a no-growth world. His ability to turn retail banking into a fun, customer-centered business, while focusing on branding, culture, and execution, offers valuable lessons for entrepreneurs in any industry. Hill’s advice on building fans, not just customers, and executing a business model that adds real value provides a roadmap for creating a lasting, high-growth company. Metro Bank’s success story is a testament to the power of innovative thinking and staying committed to delivering exceptional service, no matter the challenges in the market.