You never mentioned it but are you financially strong enough to not get paid for 3 - 6 months? I do not know what line of work you do but in mine we are constantly floating our clients A/R for 60 to 90 days and being harrassed by vendors and collectors on day 31. It seems the Net 15 days are long gone. As for the clients you can take...if I loose a member of my sales force to a competitor we go back after his client base with a vengance. So your clients would know because your old company would be banging loudly on their door.
Starting any new company is a gamble...but, starting a new company with the effect being detrimental to your family is a HUGE gamble. Working from home is fine...but you will not get much done with a hungry, crying, needy baby. You will need a babysitter - another expense. Sometimes we need to suck it up and work in jobs we do not love, but keep an ear to the rail for something better on the horizon. Good luck.

Not so much for the positive responses, eh? I suppose that is to be expected. My wife would still be a SAHM (is that an acceptable word to use here?), so childcare isn't as significant of an issue. I've run a relatively detailed budget, including insurance and all other foreseeable expenses. I think the client loss issue is less likely for me, simply because the clients I'd be taking have only ever worked with me, and their tie to my company is me (and in discussion, they've indicated a willingness to go with me). Staying at the job I have now is kind of like having all of the detriment of being your own boss, without any of the benefit. And in a small company, I feel like I'm running as much risk as I'd be running flying solo. Ah, well, much to ponder, much to consider.

It doesn't sound like you have all the detriment, nor none of the benefit.

Some of detriment of being your own boss that you don't currently have is:

-Doing all of the marketing yourself
-Doing 100% of all of the administrative tasks yourself. Paperwork, acccounting, bill collection, etc.
-Paying for 100% of the overhead yourself (office space, equipment, support staff, marketing expense, insurance, insurance, and insurance...post it notes...paper clips...)
-Having 100% of the worry about where the next client is coming from.
-Having colleagues to cover for your vacations, sick kids, and other time off.
-With any smaller business, you have less of an ability to ride through the lean times.
-Having colleagues to discuss ideas with when things are screwed up. You didn't mention what you do, but I'm guessing that your wife and friends might not be able to fill all of this void.
-Having people to BS with. It can get lonely when you're solo. Secretaries and clients don't fit the same BS-able role that coworkers/partners do.
-Lots of stress about the above that inveitably spills over into your home life to some degree. With a 10-week old, how's your household's stress tolerance reserve these days?

You didn't mention how small your current company is, but even if you have only one other partner, the issues above are greatly reduced.

Some of the benefit of being your own boss that you do currently have is:

-It sounds like your schedule is somewhat flexible (you mentioned that you're a one day a week SAHD).

The main (perhaps only?) benefit of being your own boss is some amount of flexibility to choose your own destiny. But that flexibility only applies to certain issues. In the end, you're still going to have clients to answer to if not bosses.

The price you pay for being your own boss is more stress, more hours, and less stability. You're not going to work fewer hours, you're going to work more.

Still, if you absolutely have to have that extra bit of control then maybe working for yourself is what you have to do. For better or worse, that's how I am. I speak from experience on all of this.

But, there is a high price to be paid for that last bit of control. If you haven't been there, there's a big tendency to underestimate the (mental) cost and overestimate the benefits - particularly if there's some recent office shennagans that have you ticked off.

I'm not saying that you should choose one option over the other, and I don't necessarily regret my own choices - just realize that the real issues are about more than having a few clients and a workable budget.