[varispeed]

The problem is that many individual freelancers look at their work from an employee perspective, not from a business perspective. From an employee perspective $200/hour may seem extravagant, but from business perspective it is nothing.

So if you hire an agency to perform a contract, they'll bill you $2000 per day and send you their employee who makes $100 an hour. Agency pockets the $1200 (it's a simplification, but should paint the picture).

Freelancer and agency both run the same business model. If you think like employee and charge extravagantly less, you will never grow.

You should typically charge enough, so that for any given project you could hire an employee to do the work, while you look for new leads or you can keep the money in the company and do the work yourself until you amass enough capital to move up the business ladder.