I voluntarily entered one of the most saturated markets that I'm aware of. It's literally a cliché to "do a photo startup."

That rumbling dark cloud of well-funded, well-established competitors on the horizon, and (perhaps my mistaken) belief that I see gaps of sunshine where I can succeed, is one reason I get out of bed every morning and persevere.

That, and my wife needs the product. https://blog.photostructure.com/introducing-photostructure/

(forgive the Always Be Selling, please!)

It was common sentiment when I went through YC that many excellent ideas would be dismissed by investors due to perceived existing competition or absence of market. Only rapid execution, iteration, and customer feedback can actually determine if the idea has legs and can find product market fit.