Azure sponsorship for software companies: how much Azure credit can you give your customers in FY27?
Updated 6 Nov 2026 · FY27 (1 October 2026 to 30 June 2027) · Reviewed by an ex-Microsoft team member
The short answer. Azure sponsorship is Microsoft's FY27 way of giving you Azure credit to help close deals on Microsoft Marketplace. The more you sell through Marketplace, the bigger your allowance: from $2,000 up to $400,000, and up to $2 million at $40 million of sales if you also hold a certified software designation. It is credit, not cash, and it expires. It is included in the free membership.
In plain words. Think of it as a coupon that Microsoft pays for. When you are negotiating with a customer, you can hand them Azure credit instead of cutting your own price. You can also use it to cover the Azure cost of free trials of your product. It never turns into revenue and it has an expiry date, so plan it into your next deals.
A note on words: Microsoft used to call these companies ISVs, short for independent software vendors. It now says SDCs, short for software development companies. We simply say software companies.
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Does this apply to you?
Probably yes, if:
- You sell business-to-business software on a subscription or usage basis.
- You have at least one transactable offer on Microsoft Marketplace, which means Microsoft bills your customer and pays you.
- You have billed sales through Marketplace, even small ones. The first tier starts at $500.
Not yet, if you only have a "Contact me" listing or a free listing. Those do not count as billed sales, so there is no allowance. Making one offer transactable is the first step.
Be careful, if your buyers purchase through a CSP billing account (a reseller's account). The credit cannot be used on CSP billing accounts.
How much credit do you get?
Your allowance is sized by your Marketplace billed sales over the last 12 months. "Billed sales" means what customers have actually been invoiced through Marketplace.
- $500 of billed sales: $2,000 of credit
- $25,000: $2,000
- $100,000: $35,000
- $500,000: $100,000
- $1 million: $150,000
- $4 million: $400,000
- $8 million or $20 million, with a certified software designation: $400,000
- $40 million, with a certified software designation: up to $2 million
Tiers count invoices, not orders. Invoices go out the month after the order, so a deal closed near a deadline often counts later.
What does it mean for you as a CEO?
You get two ways to use the credit.
1. To close Marketplace deals. The credit is given to the customer and tied to a Marketplace deal.
- On deals of 3 years or more, up to 10% of the yearly value.
- On deals of 1 to 2 years, up to 3% of the total value.
For example, on a 3-year deal worth $90,000 a year, the rule lets you offer up to $9,000 of credit. This is an illustration of the rule, and you can never give more than your allowance.
2. To pay for free trials. It is used on your own Azure account, and covers the Azure cost of a free trial or a $0 plan on your SaaS or Azure app offer.
How a customer grant works
- Offer it in the deal. Make it part of the negotiation.
- Close the deal. One grant per deal.
- Request it within 60 days of closing.
- Microsoft sets it up, in about 7 business days.
- The customer uses it. It is valid for 90 days, or 180 days above $100,000.
What to watch out for
- A grant covers first-party Azure at pay-as-you-go prices, up to $400,000 per request.
- Grants of $35,000 or more need the customer's Microsoft account team.
- Not eligible: CSP billing accounts, non-commercial clouds, reserved capacity and third-party purchases.
- The credit never counts toward the customer's own Azure commitment.
- Unused allowance expires after your anniversary date. Your exact allowance is shown in Partner Center, Microsoft's admin website.
- The most common slip is requesting too late. Ask within 60 days of closing.
Frequently asked questions
What replaced Marketplace Rewards?
In FY27, Marketplace Rewards is part of the Frontier Accelerate for Marketplace membership. Its Azure credit is now called Azure sponsorship.
Is Azure sponsorship cash?
No. It only reduces an Azure bill, yours or your customer's. It never reaches your revenue line, and it expires if unused.
Do I have to pay for it?
No. It is included in the no-cost membership. Premium, at $1,500 a year, is optional and adds hands-on Microsoft support.
How long do I have to request a grant?
60 days from closing the deal.
Does the credit count toward the customer's Azure commitment?
No. Credit never counts toward the customer's commitment.
Want the full picture?
Everything here is also in our complete guide to Microsoft FY27 Marketplace incentives, with plain-words notes for newcomers. Get the complete FY27 guide
Not sure which incentive fits your company?
Ask for your free Microsoft Incentives Assessment: a personalized report of every incentive your company can claim, what each is worth, and the order to claim them. Free, no obligation. No Partner Center login needed to start. Ask for your free Assessment
The other FY27 incentives
- AI Build & Publish for Marketplace
- AI Build & Publish for the Agent Store
- Customer Assessment & POV
- Customer Migrate & Modernize
- Co-sell in FY27
Based on Microsoft's FY27 Partner Investments material and the Frontier Accelerate for Marketplace pages on Microsoft Learn. Microsoft may change its programs at any time, and every payout needs Microsoft's approval. Amounts are in USD.
