I know many of my friends are working very hard and very devotedly to polish their skills, to hone their craft, sharpen their tools to the point that they begin to feel comfortable seeking to play out. I hope you won't take offense to my next statement if you're in that position.

If you're not playing with other musicians for an audience, you need to do it by any means available, as soon and as frequently as possible. You probably should start doing it long before you feel you're 'ready'. It will absolutely change your life and how you think about your place in this world.

Practice is essential to building fundamental skills. Daily practice is important to any musician as a means to develop, grow, and perfect one's chops. I liken practice to going to the gym, running miles, etc.

Rehearsal with your band-mates is equally important - you work out your (musical) moves in rehearsal, hammer out new arrangements, hone your ability to work as a team. Rehearsal is like the drills, the scrimmage, running the plays that athletes do.

Performance, though... That's where the magic happens, the rubber meets the road, the theorem is proved! That's where the most important element of the musical experience comes in:

The Audience.