Before you jump in with both feet, it's important to evaluate the feasbility of your new venture.  Clearly, you can't spend years over-analyzing and studying the opportunity.  The fact is, you have to make a go/no-go decision with less information than you'd like.  But still, it's important to ponder some key questions:

Market Feasibility

• Is there a compelling need?
• Is the market large enough to meet your growth goals?
• Is the market large enough for the business to be fundable?
• It takes time for customers to adopt new technologies/solutions - how long will your technology adoption curve be?

Technical Feasibility

• Do you have the key technical skills on the team to build the product?
• Do you have a technology advantage, and can you protect and sustain that advantage?
• Do you understand each step of the product or service implementation well enough to be confident that it can be done at all? 
• Can the product be developed in a reasonably short time, or will it take many years?

Competitive Feasibility

• Do you have a clear, sustainable competitive advantage?
• Can you overcome the competitive barriers to entry?

Financial Feasibility

• How much will it cost to deliver the product or service?
• How much will customers pay?
• Can you make money?

Funding Feasibility

• Do you have access to sufficient funds to develop the business?  (Or at least enough funds to make enough headway to get to the next fundable event?)
• Given the size of the market opportunity and the size of the funding required, can the business deliver a substantial return on investment?

Legal and Regulatory Feasibility

• Are there legal or government regulatory requirements that affect the feasibility of the business?

Liability

• Is there excessive liability involved in delivering the product or service?