Probably more important than anything is lowering the affective filter. There are many articles written on the topic and much research conducted, which can be confirmed by personal experience. Students need to feel like they can trust you and the class before they will risk making mistakes in front of you and their peers. They must feel comfortable and trust that you are not going to embarrass them or hurt their feelings. They too get stage fright and the way that you handle it will make all the difference in how they perform in your class. If you do not make your classroom a "safe" zone for each student, you will lose them forever.