The startup phase can be an extremely exciting time for any entrepreneur. However, the early days of a business present some challenges. This post goes over some of the most common hurdles new businesses face, particularly when it comes to financing.

Searching for an Investor

Businesses that seek help from investors face a search that may seem daunting at first. Finding the right fit takes a large amount of due diligence and preparation. To help you in that task, contributor Allison Engel recommends focusing on angel investors in the early stages before building an “ironclad” business plan and approaching venture capital firms. Engel also points out that cultural fit is extremely important; for instance, an extremely hands-on investor won’t be the right choice for a business that desires a more hands-off approach.

Building a Network

Another important task for new businesses is building a network. Your startup will have a much easier time if it can lean on other companies and businesspeople for advice and to learn about financing options. For specific networking strategies, check out this guide from the US Small Business Administration.

Developing an Exit Strategy

While the startup phase may seem like an odd time to consider your exit strategy, it’s actually a great time to do it. Carefully defining your exit strategy will let you inform investors of your goals, making it more likely that you’ll find the right financing partner. For instance, if your plan is to carefully grow your company to a certain value and then sell it, making investors aware of that fact from the beginning can head off potentially damaging misunderstandings down the road.


Every startup faces challenges, so don’t delay taking the steps described in this article. Procrastination will just delay the hard—but rewarding—work that goes into securing the money you need for your startup to thrive.

To keep learning about the business world, take a look at Star Capital USA’s other blog posts.