Hit town

You drive along and take several stops picking up as many as you can of the local pokemon ( you both get a ratatat and a pigi, you get a sperow and he gets an Ekans).

Around 10 you drive into viridian city, home of brock and the Boulder gym. As soon as you get into town you stop by the poke center with both of your pokemon and Blue stops by the store to pick up supplies.

The necessities in town done there a few options.

1. Challenge the gym for mastery. This involves battling several trainers and the gym leader to prove that you are strong enough to claim the gym's badge. The difficulty of the challenge is dependent on how many badges you already have. Each gym has different rules as to how they treat losers.

2. Train at the gym. This is a bit more of a commitment, you stay for a month at the gym learning their methods and special techniques. Frequently comes with a special pokemon but always comes with strings attached. At the end you may also receive the badge if the Gym Leader says you have understood the methods.

3. Challenge for supremacy. This is a bit like the first but the trainers are trying to beat you not test you. If you win you are allowed to take over the gym for yourself.

4. Do some snooping. Try to figure out what is "up" with the town. Find out about the gym and maybe anything weird going on. This may present more options.