I always start my challenging games this way:
1) buy colony ships, don't wait for them to build. Use your survey ship to sweep through your cluster to know which systems are worth colonizing.
2) research the 2 (or 3, depending on the race you select) diplomatic techs you need to get Diplomatic Translators
3) buy dip translators for cash. The advantage they give you means you can tech trade your way back to positive cash balances quickly.
4) colonize the best planet in a system. colonize n-1 planets, so a system with 3 planets, colonize the two best. Build embassies on them so when another race grabs the third one, it'll rebel and join you quickly.
5) Keep your eye on the military graph. Trade techs aggressively (don't do just one round through the other races; since you may get techs new to a race after you've traded with them the first time, keep round-robining through them until no one needs a tech you're willing to trade) If you can get all the techs for a decent warship without researching them, stick to researching things you can trade for well (xeno farms and research stuff, for example)
6) NEVER trade your diplomatic translators to a major race, NO MATTER WHAT.
7) NEVER be the weakest line on the military graph. If at all possible, stay in the top half of the pack.
8) If you build a starport on a world, build at least 2 factories for it. Otherwise, you'll die of old age before you get the ships completed there. I try to limit starports to worlds where I can pile up 3 or 4 factories.
