Do I get to walk around thinking I have instant validation, or am I rolling the dice on the likelihood that others have the same problem?
That last part is critical. Human psychology is a funny thing. Two people might experience the same pain point, but articulate two wildly different needs. Or they might have tangential pain points, nominally clustered around the same topic. And sometimes, one user's problem is another user's solution. All of these things can happen.
It is totally valid and worthwhile to start with a pain point you have. A lot of startups began that way. But never assume you (n=1) stand in for an entire market. You can't use personal anecdote or self-insight as a proxy for market validation. Not even Steve Jobs got to do that, despite popular misconceptions.
Insight can be a path to validation. A shortcut starting point. But treat it like a hypothesis, not a foregone conclusion. Hypotheses should be tested.
The product I created was a tool for a small niche of artists (of which I was a part). It solved a major problem I had, and I knew that others had the same problem. I even ran it by a few other artists and they loved the idea. What I failed to validate was whether they'd pay for the service. As it turns out, most artists in this niche can't afford to pay even $18/month for a service, and they're just as happy using a manual alternative.
I'm actually working on something right now that started like that. There are a load of large, well established incumbents operating in the market I'm about to try and pitch a tent in but none of them offer a service that does what I want. My gut told me I wasn't the only one who'd prefer my approach to the problem, so I talked to a bunch of people, refined the idea a little, did a load of research and when that all came back positive I quit my job and started building it. I'll let you know how it pans out :)
Having a competitor is a good sign, but how do you know they're profitable? How do you know they're solving the problem well enough that they're even worth imitating? How do you know they're not frustrating the hell out of their users? If you speak to potential customers, you'll know.
Not saying that you need to have full personas, in which you include ALL motivations, demographics, customer journeys - the works - but it helps to have something on paper that you can refer to.
The beauty of it is you can always change them!
No matter how certain you are talk with your customers!
I talk to people, but I need to talk to more.
Don't assume anything, get real leads and/or sales and talk to them about your planned offering and pricing.
Use data.