I really like this 2-minute explanation Stanford’s Entrepreneurship Corner: Steve Teig, Tabula – Right Time to Start a Company. He’s clearly focusing on tech companies and the web, but the principals apply elsewhere if you use your imagination.
If for any reason you don’t see the video here, you can click this link to go to the original on Stanford’s scorner.
Entrepreneurial hubris / unearned confidence? No. Get certain by doing your homework in a substantial way. What great advice!