Island News: Hawaii entrepreneurs face challenges as startup costs soar
March 27, 2025
By Reid Fowler
HONOLULU (Island News) — Despite ongoing economic uncertainty, more Americans are pursuing entrepreneurship than ever before. According to recent data from the U.S. Census Bureau, new business applications nationwide have increased by nearly 60% in the last five years. Yet, the situation is more challenging for local small-business owners in Hawaii.
A recent study by Simplify LLC ranks Hawaii as the third most expensive state to start a business, behind only California and New York. Key factors driving up costs include the nation’s highest commercial rent—averaging $36 per square foot—and some of the steepest electricity bills, averaging more than $1,500 monthly. Limited Small Business Administration lending further complicates the landscape, creating substantial hurdles for new entrepreneurs.
Trang Ly, founder of Studio Elegance, shared her struggle to secure funding.
“Especially now that I’m a year and a half in…and I’ve been struggling to find funding,” Ly said. She also noted that some banks rejected her initial requests for startup financing, which made launching her skincare business particularly difficult.
Amiel Bituin, CEO of Kauai Growth, an online marketing and web design business, also found initial funding a hurdle, dipping into his personal finances.
“I previously worked at a Fortune 500 company, and during that time, I built up two to three years of savings,” Bituin said.
Despite these obstacles and ongoing inflationary pressures, local businesses have reason for optimism. The Chamber of Commerce is stepping up with new initiatives to support entrepreneurs. The chamber is hosting the first-ever Impact SmallBiz Showcase, a networking and pitch-style event inspired by ABC’s “Shark Tank.” The showcase offers participants valuable marketing support and resources to help businesses overcome initial growth challenges.
See the story and video here.
