I'd be more worried if you have no competitors or others working on a similar (or identical) product. Even if you think you don't, you do.
When we were speaking to people about our idea, the first thing people would ask is "who are your competitors". If you don't have any then there's generally two conclusions people will draw:
- Your idea is so new and cutting edge that you're the first to think of it.
- No-one else is working on the idea because there's no market.
One of my best days was when our main competitor launched, it went towards supporting my arguments that this was a valid niche and showed that others were suffering the same problems and trying to find solutions.
You say it would be worse if someone launches before you with a similar product. I'd argue that first mover advantage can be over-rated and launching second means you have an opportunity to leapfrog the competition by offering something better than they do.
If customers have something to compare you to, it can be beneficial (assuming you provide something better) to be able to compare you to an 'inferior' competitor as validation that they've made the right decision picking your product over them.