That used to deter me as well. My line of thinking was: if the problem X is already solved by N companies, why should I launch yet another competitor? Now that I'm wiser, my answer is "because people are familiar with the problem, are already paying for the solution, which means there's a market for that". I can't stress the last point enough. The market that you choose to serve will determine most of your growth (some markets are harder to get into than others, though).

In essence, you swap an idea validation challenge with a sales and marketing challenge. If all you're looking for is building a small, independent, and sustainable business, I believe this is the most optimal approach to take.

For the context: I run a B2B SaaS in a competitive market.