(CNN) -- California's Silicon Valley has long dominated the internet industry. The world's largest dotcom companies operate from the valley, it attracts the industry's brightest minds and countless innovative ideas are generated out of the area. So, can Europe make headway in this ever-expanding industry?





Ilja Laurs, founder of Getjar -- the world's largest app store -- says there are labor, cultural and bureaucratic factors that make it very difficult for Europe to compete with Silicon Valley.





Laurs argues the talent pool across the continent for specialist services in Europe is too small. "While there are certain pockets of good people for particular niches, you maybe only able to find a hundred people in those specific areas."





That compares to the thousands available in Silicon Valley, putting Europe at a competitive disadvantage.





European startup enterprises face the same regulations that are applied to large corporations, Laurs says, putting an unfair burden on smaller companies.





Laurs says governments need to decide whether encouraging high-tech communities is something they want to focus on. He believes changes must be made to labor laws and capital gains tax for small organizations to be viable.





"The same set of rules that governs big corporations can be very damaging to small startups which operate in a very different environment," he says.





Cultural differences can also make it difficult for Europe to compete, Laurs says. He points to America's strong work ethic as an example, saying it gives Silicon Valley an edge. Facebook, for example, is not "working nine to five," he says. In Europe, by comparison, some government regulations dictate six weeks of vacation time.





He believes Europeans value other aspects of life, such as family, above work. "Americans are proud if they work and spend a hundred hours a week in the office. I'm not saying that it's good or bad, it's just the way it is and that's very incompatible with innovation."





But ultimately, Laurs says, innovation is "about trial and error."
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