Kia Ora – most people when starting a business have an idea that comes to them about a product or need and just go and do it, often they are not ‘strategic’ about the market and whether it is a good market to go after.
If I was starting ‘afresh’ – I would think about this combination of what you are passionate and have knowledge about & where there might be a market need. The latter point, around market need, you really only want to go into a market where there is an unmet set of needs and/or they are not being met well.
One way to work this out is you go and interview people in the market you are thinking about – and you ask them what and how they do what they do right now, by asking them say 10 questions you are trying to uncover whether they currently have some pain or issues that you might be able to solve. IF you ask open enough questions you may learn something that you did not know before and this might also enable you to deliver/design something that could solve a real pain for them.
In this process, if you find some people might have an issue/problem which you could solve, the next question is ‘how many other people’ are like this – ie how big is the market.
Long answer sorry – the short answer, the hardest part of starting a business is if you are serving up to people something that is not a need, you want a real unmet need, a pain that people will pay you to solve and you want lots of people wanting this.
Interview, listen, interview.
and good luck!