The other question is, what sort of airline do you want to set up.
At one end of the spectrum is Flybnw. They run from blackpool to the isle of man and back a few times a day in a chieftain(pa31). I guess they can probably take up to eight pax(to keep the weights under th limit), and I think on there website charge about 80 quid a go. So the costs will be fairly managable, and the start up would have been reasonable. The only problem is the passangers perception of hte aircraft. Ie small and noisy. But then its a small route, with business pax and general pax in winter and tourists in summer. According to the IOM website, I think the monthly figures for that route are just over a thousand in winter and more in summer.
At the next level would be a small regional model. Maybe one or two 20ish seater aircraft on about a 30 - 45min route. the cheapest way to start this up I would guess would be to wet lease. You pay a fixed hourly rate and get aircraft, crew, maitenance, insurance(acmi). Your overheads then would just be fuel, staff, handling, landing fees, euro charges, pax tax, coffee(lots of), etc. if your aircraft has 19 seats or under, I dont think you need cabin crew, which again reduces your costs. an example would be flykeen. (again surprisingly out of blackpool)
The next aircraft of choice from there would be an atr 42. cheapish running costs, and its well established as a regional airline.
The main points, as with any business are to research your market, and work out how to cater for it.
Find a route which has little or no competition, and which could carry about 50 pax each day, each way. will they mostly be toursit, business, or locals who are willing to pay up to 100 pounds because the local transport(buses, trains) are unrelable or infrequent.
how will you sell your tickets. Over the internet? Through travel agents? your own reservations office(or use the services of another call center).
What about marketing, and ticket pricing. Are you aiming towards the low cost end(people generally dont like paying 100 pounds when they can pay 50), or asking people to pay more, but offering a quality service?
If you were going to do this as a way to get a job flying airliners, then I wouldnt bother. After you've been working 18hrs a day organising and running the show for six months, the last thing you would want to do is get up at 6 in the morning to do 4 sectors. And what happens when an importat meeting comes up. You have to be there, and you cant change the times, but your due to fly. And to keep your cost down you are not employing pilots to sit around and fly if your busy. which you will be most of the time.
Anyways, Im off to feed the dog.
cheerio