Most startups fail because the serial entrepreneur build stuff they think people need but would never use themselves. It's not as easy as just researching what potential customers may need. If YOU are not that potential customer, then you won't have the intuition to make something better than the competition when they pop up. Also, if YOU're not the target customer, your passion for the project will fade way before you actually make money from it.

The above is true for both projects large and small. I still think Google+ will ultimately fail b/c its top level execs don't use the platform and therefore won't have any insights about where to take it.