The holy grail for standups: the in-flow set.
The in-flow set is when you're just riffing. It's the opposite of a typical set you see on tv, where everything's super-rehearsed. You're in the moment, calling the room, doing crowdwork, working in something that happened today, saying whatever's on your mind, barely relying on established material at all. You're just so funny that you can make it up as you go along. The audience guides you with their response.
Two of the best I've seen at this: Greg Giraldo (tornado energy) and Todd Barry (hypnotic delivery). One reason you see these guys do sets at small places like UCB or Rififi, for free/cheap, is because that environment is where they can really go for flow.
Flow riffing comes with extra bite. When you're doing written material, your brain is in the back. When you're improvising, your brain comes to the front. You're applied. The audience senses that. They give you extra points for pulling off the dance. Plus, it's easier to say something surprising. After all, you're surprising yourself. Surprising = funny.
Some pro comics are so good at weaving in and out of written material that you don't know which parts they've done before and which ones are just coming to 'em on the spot. They make the transition seamless. That's why it's interesting to see the same comic multiple times in a short stretch. You see when they drop anchor and when they sail.
Flow sets are great because they're fun to do, especially if you perform all the time. Doing the same jokes every night for months on end is lame. If you can pull off the in-flow set, you keep yourself amused. Plus, you get to discover all the time. When you hit on something that kills, you can save it and bring it in to your foundation set, the one you might use on tv or whatever.
Flow sets are when you jam. Foundation sets are when you play your songs.
