Pre-order is reliable signal. How does one go about software services though?

For the past 2 weeks I've been analyzing a problem & I think my target segment desperately needs a solution (based on discussions on online forums, including HN.) I'm about to begin market research to validate my assumptions & to check if my userbase can actually shell out money.

Presently, I'm thinking of getting some pilot users & offer my service for free (or a small fee, since I'd be doing some non-trivial work for them). If the results seem promising, I'll pitch my idea to others. I've been part of few early stage startups but this is the first time I'm doing something of my own. Is there a better way to do this validation?