> You raise money, you build something, and then you have a limited time to see whether your hypothesis about the market was correct.

Or, you get to know an industry, see a need, design a solution, bounce your ideas off people in the industry, do some mock-ups to get some initial acceptance of the idea, ask if they'd pay for it, and if/when all that comes together, then start to build. If you cannot build it with your available resources, maybe look for some funding.