In an era of information abundance, the most valuable investment insights often come from primary research—original data and perspectives gathered directly rather than synthesized from public sources.

This guide explores the primary research methods used by sophisticated investors, their relative strengths, and how to build an effective primary research program.

Why Primary Research Matters

Secondary research—analyst reports, news, filings—is available to everyone. By definition, it can't provide sustainable competitive advantage.

Primary research offers something different:

Timeliness: Original data before it becomes widely known
Specificity: Information tailored to your exact questions
Depth: Nuance and context that public sources lack
Differentiation: Insights your competitors don't have

The best investment firms treat primary research as a core competency, investing significantly in capabilities and processes.

Expert Interviews

Expert interviews remain the backbone of primary research for most fundamental investors.

What Experts Provide

Industry context: Understanding market dynamics, competitive positioning, and trends that don't appear in financial statements.

Operational insight: How companies actually function—their processes, culture, and execution capabilities.

Forward perspective: Views on where industries are heading based on direct observation.

Reality checks: Validation or challenge of assumptions from public sources.

Types of Experts

Former executives: Deep knowledge of specific companies but potentially dated.

Industry consultants: Broad perspective across multiple players.

Functional specialists: Expertise in specific areas (supply chain, technology, sales).

Adjacent professionals: Suppliers, customers, or partners with relevant visibility.

Academics and researchers: Theoretical frameworks and long-term perspectives.

Structuring an Expert Program

Effective expert interview programs require:

Clear objectives: Define what you're trying to learn before engaging experts.

Expert sourcing: Relationships with networks that can identify relevant experts quickly.

Interview skills: Training analysts to conduct effective conversations.

Knowledge capture: Systems to document and preserve insights.

Quality tracking: Mechanisms to identify which experts deliver value.

Channel Checks

Channel checks gather data directly from participants in a company's ecosystem—customers, distributors, suppliers, or competitors.

Common Approaches

Customer surveys: Structured questionnaires to understand purchasing behavior, satisfaction, and intentions.

Retail checks: Physical visits to stores to observe product placement, pricing, and inventory.

Distributor conversations: Discussions with channel partners about demand trends and competitive dynamics.

Supplier intelligence: Information from upstream partners about order patterns and business health.

Advantages and Limitations

Channel checks can provide real-time data on business momentum before it appears in financial results. They're particularly valuable for:

Consumer businesses with observable retail presence
Companies with distributed sales channels
Situations where official guidance may lag reality

Limitations include sample size constraints, difficulty accessing B2B channels, and the challenge of distinguishing signal from noise.

Industry Conferences and Events

Conferences provide concentrated access to management teams, experts, and peers.

Value Extraction

Management access: One-on-one meetings or group sessions with company leadership.

Expert panels: Industry discussions featuring multiple perspectives.

Peer exchange: Conversations with other investors about shared coverage areas.

Product exposure: Hands-on experience with new offerings and demonstrations.

Maximizing Conference ROI

Preparation matters enormously:

Schedule key meetings in advance
Prepare specific questions for each interaction
Coordinate with team members to cover more ground
Plan synthesis sessions to consolidate learning

The analysts who walk into conferences with clear objectives extract far more value than those who wander the floor hoping for serendipity.

Proprietary Data Collection

Some investors build their own data assets through systematic collection.

Examples

Web scraping: Automated collection of pricing, product listings, or job postings.

Satellite imagery: Monitoring retail parking lots, construction activity, or shipping traffic.

App analytics: Tracking download trends, usage patterns, or engagement metrics.

Transaction data: Aggregated spending patterns from credit cards or receipts.

Sensor data: IoT-generated information about industrial activity or environmental conditions.

Build vs. Buy

Proprietary data collection requires significant investment:

Technical infrastructure for collection and storage
Analytical capabilities to extract signal
Legal review for data sourcing compliance
Ongoing maintenance as sources evolve

Many firms partner with alternative data providers rather than building capabilities internally.

Surveys and Panels

Structured surveys provide quantifiable data across larger sample sizes than individual expert conversations.

Applications

Customer research: Understanding buying behavior, brand perception, and switching intentions.

Professional panels: Gathering perspectives from industry practitioners.

Consumer sentiment: Tracking attitudes toward products, companies, or trends.

Survey Design Considerations

Effective surveys require:

Clear hypotheses to test
Unbiased question design
Representative sample selection
Statistical rigor in analysis
Understanding of limitations

Poorly designed surveys can mislead rather than inform.

Site Visits and Management Meetings

Nothing replaces direct observation of company operations and face-to-face interaction with leadership.

Site Visit Objectives

Operational assessment: Observing facilities, processes, and workforce.

Cultural evaluation: Sensing the organization's energy, focus, and capabilities.

Verification: Confirming claims made in public presentations.

Relationship building: Establishing rapport for ongoing dialogue.

Management Meeting Preparation

The quality of management meetings depends heavily on preparation:

Demonstrate understanding of the business
Ask questions that reveal how management thinks, not just what they know
Listen for what's not said as much as what is
Follow up on interesting threads

Generic questions yield generic answers. Specific, informed questions generate insight.

Building a Primary Research Program

Effective primary research requires more than ad hoc efforts. Leading investors build systematic programs.

Resource Allocation

Determine what percentage of research time and budget goes to primary vs. secondary research. For many hedge funds, primary research represents 40-60% of research activity.

Specialization vs. Generalization

Some firms have dedicated primary research teams. Others integrate primary research into analyst responsibilities. The right approach depends on firm size and strategy.

Process Development

Document and refine processes for:

Prioritizing primary research topics
Sourcing experts and data providers
Conducting interviews and analysis
Capturing and sharing insights
Evaluating effectiveness

Technology Infrastructure

Modern primary research programs require technology support:

CRM systems for tracking relationships
Transcription tools for capturing conversations
Knowledge management for organizing insights
Analytics for measuring program effectiveness

Continuous Improvement

Regularly assess what's working and what isn't:

Which research methods yield the best insights?
Which experts provide differentiated value?
Where are there gaps in coverage or capability?
How can processes be improved?

Integration with Investment Process

Primary research is most valuable when integrated tightly with investment decision-making.

Thesis Development

Use primary research to develop differentiated investment theses. The best ideas often emerge from proprietary insights.

Assumption Testing

Primary research should continuously test and refine the assumptions underlying positions.

Risk Monitoring

Ongoing primary research helps identify emerging risks before they appear in financial results or market prices.

Exit Discipline

Primary research can signal when it's time to exit—when the thesis is playing out or when competitive dynamics are shifting.

The Future of Primary Research

Several trends are reshaping primary research:

AI augmentation: Technology that helps process and analyze primary data more effectively.

New data sources: Expanding universe of alternative data offering novel signals.

Remote access: Technology enabling primary research without physical presence.

Democratization: More accessible tools leveling the playing field.

The firms that master primary research—both the methods and the technology that amplifies them—will maintain meaningful advantages in competitive markets.

InsightAgent enhances expert interview capture and analysis. See how we can help.

Primary Research Methods for Investment Professionals