"Working with individuals or small businesses can be tough because they are usually highly constrained by budget and do not understand everything that goes in to what you do. They want freelancers because they can't afford full time people."

I've also found this to be very true.

When I'm evaluating clients I consider whether or not the person writing the check is using their own money. More mature clients often have a marketing director or employee that has a budget. With entrepreneurs and small businesses, you're often speaking to the owner and they tend to care more about how much something costs. It's just more difficult.