I understand this is kind of a vague question since it varies depending on where you live, but what are some common places that most cities have that let amateurs perform live? I'm really a shy type of person (at one point I was to embarrassed to play/practice in front of my parents) so I figured if I were to perform now it would be very stellar and mediocre but if I try get outside my comfort zone as much as possible by performing a lot I might be able to give a good performance. I would like to start out not performing solo because I think that is way too intimidating for me. If it helps I play the guitar and I would be interested in hearing how the more experienced people out there started out performing live.
It's going to be dependent on the sort of music you are playing, to a great degree.
You may join a vocalist, and simply provide a rhythm guitar backing. You may become a member of a band, perhaps 4 or 5 of you, where the spotlight won't be on you much. You may want to try a bit of busking, with others, where the public will be passing, and therefore the audience is changing by the minute. You may want to join a local church, where you could provide some guitar music for some choir songs, of for the congregation to leave, listening to you. You could advertise for others, or to join others, on sites such as 'Join My Band', when the auditions and rehearsals themselves will help you. You may like to record some stuff to play over - loop stations are great for that - so you won't be 'playing alone' in a manner of speaking. You may want to go along to an open mic night - others such as you will do the same - and play with those others. You might like to try a local youth club or music school, which have mini gigs. The list goes on... and on.
If you want a chance to play with others in front of an audience, your best bet is open jam sessions. Like open mics, these happen at cafes and bars. They're not as common as open mics, but there are still plenty, especially in the big cities. Blues, bluegrass and Celtic music all seem to have a lot of open jams. There's a decent amount of them listed on Meetup.com, and I'm sure there are other sites I don't know about. These have the big advantage that there's a zillion other players there, so if you mess up, people will hardly notice.
If you just want to get comfortable playing with others, but don't need an audience, there are also loads of private jam sessions. Many of these are only "private" in the sense that they happen at somebody's house with no audience, but they still welcome new musicians. Again, a lot of these can be found on Meetup.
You can also just ask some of the musicians you do know about the jam situation in your city. Word gets around pretty well.
There is only one choice: in performances. But note, that you don't have to be the soloist, or even play everything, the event may even have a different main focus (like a photo presentation), where you just musically introduce the break.
If this fails, the next best choice in my opinion is chamber music; you will have no other audience than your co-musicians, but this is at least a big step compared to playing for yourself.
Google for your city and "open mic" or "jam". Spectators are usually welcome, so you can go without your instrument at first to get a feeling for it. That's also a way to meet people that might be fun to play with.
That is an excellent question and I can relate to what you are feeling. When I first started learning to play guitar and sing I got to a point where I was perfectly comfortable home alone on my couch singing and playing for the furniture. But bring an audience of even one person in the room and all of a sudden I couldn't get my fingers to work and could not even play a basic chord! I think they call it "stage fright" - and it's normal for most humans.
Eventually if it does not kill you, it will disappear and you will relish every opportunity to perform for others (live) - once you gain confidence.
If you want to start slow and work your way up to live performances such as open mics and open jams others have suggested - here are some ideas that I used to slowly overcome the fear of an audience.
One thing to try is simply playing outside on your front porch or back deck or sitting on a park bench where you don't actually have an audience in front of you - but the mere possibility that someone might hear you will provide a very tangible element of fear that it will take a deliberate effort to overcome. I can remember when I first did this on the back deck of a condo I lived in. I couldn't see anyone so I could easily pretend that no one was listening. But still I could feel the intimidation factor kick in when I moved from the safety of the couch to the back deck. One time after a performance I could actually hear several unseen neighbors applauding. That actually made it more like performing for a real audience going forward - but eventually I became comfortable playing for my unseen audience and the applause became a regular reward.
Another idea that will help you get used to dealing with the "stage fright" is recording your performance. In the recording studio they call it "red light fever" and it's a close cousin of stage fright. New recording artist experience it the first few times in the studio - where they perform a song flawlessly when the engineer is just trying to tweak his levels but when the actual recording process starts - they fall apart (happend to me my first time).
You can set up a video camera or smart phone on a tripod and make a video of your performance. At first you will see that hitting the record button will cause you to mess up more than if you were not recording. Eventually you get to a point where it does not affect you. Knowing you can delete the video before anyone sees it reduces the stage fright to a tolerable level. Once you can pull off a video recording of a performance you would not mind sharing with others - then you are ready for the next step.
Post your performance on YouTube. Set up a YouTube channel for your musical performances and set a goal to post a vid of your performance of a song you have mastered. Then another, then another etc. Knowing that the world will be watching will provide a greater intimidation factor to conquer- but knowing that you don't have to post the outtakes will reduce the pressure. You might want to disable comments when you post - because the intraweb community can be quite critical and quite harsh. You don't want negative comments impinging on your confidence quite yet.
Invite a friend over to hear you perform. At first you will find this very intimidating. But if you have already posted a performance on YouTube and you think it represents a good example of your current skill level, invite your friend to view the video before seeing you live. Then you will overcome that first hurdle - the fear of being judged - because they will have already had the opportunity to judge you by watching the video and you will feel like you have already proved your ability before the live performance.
Perhaps even tell your friend what you are hoping to accomplish and say - "I was able to overcome the fear of recording my performance and now I want to see if I can do the same for a live audience". Then just keep playing the same song until you get through it at the same level you know you are capable of when alone.
Once you can comfortably play for one friend, throw a party and invite several friends.
Optional if you have the time and money - Take private or group lessons. You will be performing for your instructor and if in a group lesson, in front of other budding guitarist who will likely be going through the same feelings you are - which will make it easier for you. Guitar Center in the US sometimes hosts free guitar workshops for beginners. Even if you are not a beginner, one of these type workshops will give you some experience playing for others.
Another idea is to go to your local guitar retailer and try out some guitars by playing some songs you know. I found this less intimidating than playing a full song for a friend when I was a newbie. I didn't feel any pressure to play any song perfectly because after all - I was just trying out the guitar.
Open jams either organized or informal are a great way to play along without being the center of attention. At an open jam you can just strum along with a bunch of other musicians and pretend nobody is listening to your guitar. If you get lost and drop out, the other guitarist playing along will carry the song forward so no worries.
When you have developed the ability to perform for a small group of friends, you are probably ready to try your first open mic (although you will never actually feel like you are ready). You might tell the host or hostess that this is your first ever open mic and you only want to perform one song - or two if you feel comfortable enough after the first (or feel a need to redeem yourself). Before the big day - pick a few songs that you are most comfortable playing and practice those few songs until you can perform them flawlessly without thinking about them. No complex chords or fast changes or complicated strumming patterns. Then get up there and do it!
Tell yourself that your goal is just to survive your first open mic. You can announce from the stage that this is your first open mic to lower expectations if it makes you feel more comfortable. The audience, consisting of mostly other musicians, will be sympathetic and supportive because they can probably remember how scary it was at their first open mic performance.
The first open mic is always the hardest and scariest by far. The second time you perform on stage at an open mic will be exponentially easier than the first time. It's like jumping off the high dive for the first time. Once you overcome the initial fear of doing it and realize that you didn't die and that it was actually kinda fun - you can't wait to do it again.
It's a journey - but if you take it one step at a time you will soon be posting YouTube vids every other week and making Open Mics a regular part of your weekly routine. Before long other musicians will be inviting you to join their band and next thing you know you will be getting paid to perform on stage.
Good luck and enjoy the journey!
Busking is a great way to gain experience and gain real-time feedback on your performance. Passersby will vote with their attention and their money.
Or as Woody Guthrie put it (paraphrased):
Find a place, put your hat down in front of you and start playing. When people start putting money in the hat, you're a professional musician.