Innovations in Social Entrepreneurship for Sustainable Biofuel Production: The Case of Tanzanian Outgrowers Cultivating Jatropha for the Global Biofuel Chain

This chapter focuses on the smallholder outgrower model for Jatropha biofuel cultivation in Tanzania. This model is based on seed production by small farmers who sell to a processing company that presses the bio-oil from the seeds locally, either for the local market or for export. This model has been implemented by a foreign investor in Tanzania; the social business model aims at combining profit making with social and environmental objectives. This chapter describes the trends and developments of this innovative business model in a global cultivation, production and usage chain, exploring the trade-offs between the people, planet, profit objectives (triple P) and how the business model adapts to survive through the different stages of the innovation process. The three stages in the innovation process, also described in learning theories are: (1) learning to be effective, (2) learning to be efficient and (3) learning to expand (up-scaling and diffusion). The observed trend is that in the different stages different roles are played by the company as it aims at shifting from subsidy funds to profit making. In the process of becoming efficient and starting to upscale, it seems harder to ensure the implementation of the social and environmental objectives. Therefore, public actors will have to play a more active role in capacity building and market regulation, and additional funding has to be made available for ensuring the social and environmental benefits. New innovations in governance and new ways of linking actors may be part of the solution.