Smallholders often cannot obtain the agroforestry germplasm they require. It has been suggested that commercial smallholder production of germplasm could help resolve this problem, while securing benefits such as genetic conservation and income generation. We evaluate four such initiatives. We found that worthwhile income was generated, and we suggest ways that returns could be increased. We also found that the initiatives had contributed to genetic conservation, although we argue that such outcomes may be more elusive for timber trees than for non-destructively harvested tree crops. The four initiatives fell short of the “win-win” ideal of germplasm production, i.e. that of smallholders profiting through sale of livelihood-enhancing germplasm to other smallholders, principally because sales tend to be to industrial or institutional clients rather than to smallholders. We suggest that, for the potential of smallholder germplasm production to be fully evaluated, detailed characterization of farmer demand and willingness to pay for agroforestry germplasm is needed. © 2010 Taylor & Francis Group, LLC.