Campaign Mode strategy: During the first few levels getting your third hero, you’d easily feel how effective Heroes are to hold off the enemy waves. There is no better proof to this than fully utilizing them in this level. During the start of the level, you’ll be surprised to how little funds you get to start with. Nonetheless, everything is fine.
Since you are given a heads-up as to where the first enemy wave will be coming from, it is safe to assume that you’ll be safe to place Lancelot to guard this route. Lancelot is quite equivalent to 3 fully upgraded melee soldiers. In addition to this, you now have Fee which is quite equivalent to a fully upgraded archer tower, and Bolton which adds up to total damage. You’d be fine throughout the first wave with only the three Heroes you’ve got. But since you have 500 coins lying around, why not put them to good use at least.
Build a fully upgraded cannon (or at least the maximum upgrade you get with 500 coins) on the intersection closest to your base. Move Fee and Bolton away from the road, but in proximity to enemies blocked by Lancelot. Use Fee’s wolf to add-in to the pack. To avoid screw-ups, build two barracks (to the sites nearest to your base) as soon as you get the money to do so. You don’t have to upgrade them now, instead, focus on building and upgrading a secondary cannon on the last available site in this intersection. The waves in this level are pretty fast paced. By the time you have fully upgraded these four towers on the intersection, it is already on the 6th wave.
You might want to save Fee’s wolf at the beginning of this wave as well as a villager will show up from the right most part of the screen, quickly followed by tons of monsters coming from all entry points. Use the wolf to distract the incoming horde (in the intersection) – giving safe passage to the villager. Before the wave volume thins down, you might want to put up another two to three fully upgraded cannon to help trim down the horde on the concluding final wave. This should be plenty to hold off the enemy wave and win the 3-star rating.
Legendary strategy: Put up two barracks near your base and on the opposite side of them two fully upgraded cannons. Have your Heroes sit on the intersection with the troops (except for Fee). Upgrade your barracks when possible.