As the country's leading conservative donors finished off plates of roast lamb and spaetzle in a Palm Springs, Calif., hotel ballroom on Monday, Charles G. Koch delivered a pep talk.
The November elections had been a major setback for the cause of liberty, Mr. Koch told the more than 200 guests, many of whom had pumped millions of dollars into the political operation founded by him and his brother David. But there would be no backing down, Charles Koch said, according to some of those attending. They would learn from their mistakes, test new strategies in the coming months and prepare for the 2014 elections, with control of Congress once again at stake.
As the Republican Party grapples with implications of its historic losses last fall, a similar reckoning is unfolding among the deep-pocketed conservatives whose super-PACs and other organizations spent heavily to defeat President Barack Obama and the Democrats in 2012. Nowhere is the self-examination more unrelenting than within the constellation of advocacy groups, foundations and research organizations nurtured by the Kochs.
"They took this defeat pretty hard and pretty self-critically -- which is always a good sign of a vital organization," said Jack Schuler, a Chicago-area philanthropist and entrepreneur who has been involved in some of the discussions. "I think the dollars will flow if we get a sense that there's a formula that's going to work. They don't like to fund losing causes. The attitude is: Show me this new approach is going to work."
While awaiting an internal audit headed by a top Koch Industries executive, the brothers have rejected any notion of stepping back from electoral politics. Strikingly, after years of nurturing a political network and donor base largely independent from traditional Republican circles, the Kochs are planning to substantially increase their involvement in party affairs.
They have not yet decided whether to intervene in Republican primaries, people involved in the discussions say. But the brothers want their network to play a bigger role in cultivating and promoting Republican candidates who hew to their vision of conservatism, emphasizing smaller government and deregulation more than immigration and social issues. They are also seeking closer control over groups within their network, purging or downgrading those that did not deliver last year and expanding financing for those that performed well.
"After the 2012 election, we took a long, hard look at the effectiveness of the organizations we support -- what they did well, what worked and areas where we can be more effective," said Robert A. Tappan, a Koch spokesman. "This past weekend's gathering was an opportunity to share the lessons learned from 2012."
Those discussions unfolded over two days at the Renaissance Esmeralda, a sprawling golf resort that has previously hosted the Kochs' twice-yearly conferences. The atmosphere was equal parts revival and situation room, participants said: Phones and electronic devices were banned from some panels, as Koch strategists detailed next year's electoral battlegrounds and donors committed contributions to particular states or projects.
At least a half-dozen rising Republican stars were also in attendance. They included Ben Carson, a Baltimore neurosurgeon who has quickly developed a following among grass-roots conservatives, and several members of the Tea Party wing: Govs. Nikki R. Haley of South Carolina and John R. Kasich of Ohio, along with Sens. Ted Cruz of Texas and Rand Paul of Kentucky.
Donors and others involved with the Koch-backed groups believe that the libertarian conservatism espoused by the brothers could help reinvigorate Republican fortunes, particularly among the young. They are also seeking to match the data and vote-targeting machinery built by Obama, widely credited as one of the most important factors in his re-election.
"We're looking into some of that cutting-edge technology," said Evan Feinberg, a former aide to Paul who is now president of Generation Opportunity, a Koch-financed group focusing on young voters. "Obama for America did some really interesting things to connect to young people. We want to use some of those same ideas and try to learn from them."
Efforts are also under way to replicate the Democrats' voter registration organizations, which Koch advisers believe have leapfrogged those of conservative and Republican groups. And much like other conservative groups, those in the Koch network are preparing new initiatives aimed at Hispanic voters, who they believe will be attracted to a small-government message unburdened by the hard-edged social conservatism that hamstrung Republican candidates in several critical races last year.
Many of those efforts will emanate from the Libre Initiative, a Hispanic-oriented conservative group for which the Koch network plans to expand financing this year. Some groups, like the 60 Plus Association, a conservative group aimed at courting older voters, are likely to receive less support going forward. In other cases, the Kochs are seeking to knit organizations more closely with their company's in-house public affairs team.
This year, for example, two trusted Koch employees were placed on the board of Americans for Prosperity, the brothers' flagship grass-roots organization. A new tax-exempt group, the Association for American Innovation, is being set up to manage turf disputes among the many different state-level groups that receive money from the Koch network.
Even as they retool, though, the Kochs face intense competition for dollars and talent. An entire universe of conservative super PACs and other groups has expanded in the wake of the Supreme Court's Citizens United decision, one only loosely tethered to either party's traditional infrastructure. Some, like American Crossroads, founded by Karl Rove, have conducted similar self-autopsies and have begun parallel efforts to recruit young or Latino voters. Often they are seeking out the same donors.
"Everybody wants your money," said Stanley S. Hubbard, a Minnesota-based media mogul. Mr. Hubbard said he and other donors had decided to wait a few months before committing to the Kochs' groups or any others.
"I think they're very smart on pointing out the things that are foolish," Mr. Hubbard said, referring to the attack ads run last year by groups such as Americans for Prosperity. "They run ads attacking what's wrong. I'd like to see them point out what would be good policies, and why."