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If social media can change the world, how can it not impact your law firm?

March 1, 2011

David Rubenstein, Co-Founder of The Carlyle Group, one of the world’s largest private equity firms, speaking in Berlin this morning, identified three great unknowns likely to effect the global financial community.

They are: the effect of the Mideast unrest, the debt problems in the United States and social media sites like Twitter and Facebook.

Yes, you heard right. Social media.

Rubenstein, as reported by The New York Times’ Rhea Wessel predicted social media will change the industry — he just doesn’t know how.

We don’t know the impact of social media on private equity. But it’s very hard to believe that the Facebook revolution can change the world and not impact private equity. Private equity cannot operate isolated. I think there will be some impact of social networking on private equity, but I just don’t know what it will be this year.

Shareholder activists taking their fights online is one threat social media poses per Rubenstein.

Let’s suppose somebody wants to buy a company and has to get shareholder approval. Employees and shareholders could use Facebook to rally support against an acquisition. We’ve never seen that kind of thing before. But it could happen.

How is social media going to impact the legal profession and law firms? No one knows for certain. But it would be the height of folly to believe if social media can can change the world that the law is going to receive a pass.

No question you’ll see the expansion of social media in business development efforts. You’re going to see more senior leaders in law firms, the rainmaking lawyers with corporate and government relationships, begin to use social media to nurture existing relationships and build new ones.

Where things will get interesting is when social media begins to impact high stakes litigation and transactions. What’s to stop a group of activists forming on blogs, Facebook, or Twitter to oppose a law firm’s advocacy on behalf of a corporate client? Or to oppose a law firm’s hiring or firing practices?

Law firms without an effective Internet presence, one where their leadership or high profile lawyers are experienced with social media, will be at a distinct competitive disadvantage when this happens. You don’t build trusted allies and online relationships with bloggers, the media, and social media influencers overnight.

I’ve been thinking of making this point before – how do law firms expect social media not to impact them if social media is changing the world. When David Rubenstein, a leader in the global financial community and one of the wealthiest men in the world raised the question, I thought it time to ask you.