Finally, as you continue testing your Monetizable Pain Hypothesis and Big Idea Hypothesis, don't overlook what we call the 30,000 feet test. This test simply asks you to back way off the details of talking to customers and consider the following dynamics:
Sufficiently Large Market - building a business in a tiny market can be challenging because there may be little room to grow, whereas in large markets there may be greater rewards to scaling the business. And although bigger could be better, there are important caveats as you think about the initial attraction of big markets. The most important is that large markets often have large competitors. If that is the case, the actual market size that you can affect may be much smaller than you initially thought. You may need to tackle the edges of the market first or pursue a cooperative strategy to succeed.
Rapidly Growing Market - you should examine whether the market is growing. It is much easier to compete and succeed in growing markets. The old adage that a "rising tide lifts all ships" is particularly true in the startup world. In contrast, shrinking markets may be the most difficult markets to tackle because customers are no longer investing and existing competitors are desparately fighting for business.
Competition - when it comes to competition, the worst thing an entrepreneur can say is "we don't have any competitors." The truth is that you have competitors. Every good idea is probably being considered by someone else. Of course, the second worst thing an entrepreneur can say is "there's an 800-pound gorilla in our space, and we are going to kill it because we have a better product." Such a statement is naive and shows a lack of sophistication and appreciation for the battle you are about to undertake. Whether you have one big competitor or many small ones, successful entrepreneurs create a competitive matrix to better understand the landscape.
(See Nail It Then Scale It, pgs. 85-90)