If you’re a managed service provider (MSP) or managed intelligence provider (MIP) looking to build recurring revenue and strengthen your cloud practice, Microsoft Azure can be a great way to scale profitability. The challenge? Knowing where to start and how to make the economics work in your favor.
At Pax8, we’re helping partners build profitable Azure practices by leveraging rich incentive programs, white-label implementation offerings and strategic upsell motions. And while profitability doesn’t happen overnight, other partners are already taking advantage of these offerings — so now is the time to make your move if you want to make it happen.
Below, we break down the ways you can maximize Microsoft partner funding programs for Azure and grow profitably with Pax8.
Maximize Your Microsoft Partnership With Incentives
Microsoft invests deeply in partner success with incentive programs for Azure workloads. But these can be tricky to navigate, and many partners unintentionally leave value on the table. Below, we detail these programs and how to make the most of them.
Incentives and Promotions
Promotions through Microsoft Commercial Incentives (MCI) are provided to reward you for growing your Microsoft business in each solution area (Modern Work, Security, Azure and Business Applications).
These can be greatly beneficial for getting new Microsoft business off the ground. But, in order to earn incentives through the Microsoft AI Cloud Partner Program (MAICPP), there are some requirements for eligibility that you need to meet.
- Enroll as a Microsoft CSP Indirect Reseller.
- Enroll in Microsoft Commerce Incentives.
- Achieve $25,000 trailing twelve months at partner location (TTM).
- Attain a Solutions Partner Designation (or 25 capability points, specific to the solution area incentive) or Specialization.
Please note: Some factors may affect incentive eligibility, such as which specific Azure Designation you hold (Infrastructure, Data & AI, Digital App Innovation) and whether you qualify for the SMB or Enterprise path, which have different requirements but both lead to the same designations and benefits. You can learn more here.
How Incentives Play Out
Through MCI, a portion of your Azure revenue that rolls through your MAICPP agreement makes its way back to you, making it an attractive way to kick your Azure sales into high gear.
Earning types are split between:
- 60% rebate (paid out to the partner)
- 40% co-op (held for Microsoft approved engagements and marketing activities claimed in Partner Center)
Rebates
Currently, this applies to two Azure CSP incentive offers:
- 3% Azure CSP Consumption
- 7.5% Azure CSP Growth Calculator (measures year-over-year growth)
Let’s look at an example to illustrate how this plays out:
A partner grows their Azure revenue with their customers while holding the Solution Partner Designation in Azure. In one month, they reported $10,000 Azure Consumed Revenue (ACR). A year later, they’ve grown their ACR to $15,000 per month.
Since they increased their monthly recurring revenue to $15,000 ACR per month, they receive 3% of that total value, or $450 ($270 rebate and $180 in co-op earned).
For the $5,000 in revenue they have grown year-over-year, they receive 7.5%, or $375 ($225 rebate and $150 in co-op earned).
This adds up quickly, especially as more workloads shift into Azure.
Learn more about MCI Partner Incentives in Microsoft’s guide.
Co-op
You can also start earning cooperative marketing funds, with certain limitations. You only earn funds once per enrolled partner ID, need at least $25K in earnings to be eligible for co-op and funds must reach a $10,000 minimum to be available for use. If you don’t meet the threshold, you receive the funds as a rebate.
These aren’t just any old funds. They’re designed to help you differentiate your business and build channel awareness by spending them on eligible marketing activities.
You can claim a variety of activities to invest co-op funds back into your Azure business, such as:
- Demand generation activities, including print/digital advertising, direct mail/email/SMS, partner website and SEO, and social media
- Market development, including tradeshows, customer training, migration services, proof of concept and internal sales incentives
- Partner readiness expenses, including Microsoft training for your staff, attendance to Microsoft-hosted events and even MPN participation costs
View the full list of eligible activities and proof of execution required to claim funding in the FY26 Partner Incentive Co-op Guidebook.
Azure Accelerate
Let’s turn to some other ways partners can tap into funding through Azure Accelerate (formerly known as Azure Migrate and Modernize or AMM).
Azure Accelerate is a benefit within MAICCP that helps reduce the financial barriers for partners looking to jumpstart an Azure business. It’s available to Microsoft partners who have earned an Azure specialization or SMB designation.
Eligible partners can nominate a customer to receive funding for pre- and post-sales support, making it easier to deploy Azure solutions, with expert guidance and at a reduced cost. Keep in mind, the partner who claims funding must perform the deployment, not a third party, unless it’s the partner’s distributor or cloud marketplace.
As such, if you don’t have the in-house resources to complete a deployment, Pax8 Professional Services can step in to handle the heavy lifting, saving you effort and time with Azure migration projects. What’s more, we can even help you with funding on eligible projects.
Talk to our experts to check your Azure Accelerate eligibility and how we can help you streamline deployments.
Azure Frontier Offer
The Azure Frontier Offer (AFO) is a limited-time funding offer and an extension of Azure Accelerate that can be applied to new database migrations, Microsoft Fabric or Azure Foundry deployments.
Here’s what you’ll need to qualify for this program:
- Any project size with year-one ACR > $1
- >50% of incremental Year-one ACR must be from databases, Fabric and/or Foundry
Funding is backed by two sources, End Customer Investment Funds (ECIF) and the Azure Credit Offer (ACO), which can be used in combination or individually. The offer is strictly post-sales only, aimed at reducing early financial friction while projects ramp up (ACO) and helping partners succeed after the deal closes (ECIF).
Partners can leverage ECIF, ACO or both, as follows:
- ECIF only (2:1 ROI): up to $500K (paid to the partner)
- ACO only (2:1 ROI): up to $500K (applied to the customer’s Azure tenant)
- ECIF + ACO (2:1 ROI): up to $500K ECIF + $500K ACO
When partners leverage both ECIF and ACO, they can receive up to $1M total, allowing Microsoft to fund 100% of the year-one ACR.
When only ECIF or ACO is used, Microsoft funds 50% of the project.
Just like with Azure Accelerate, the Azure deployment must be performed by the claiming Microsoft partner. If your Microsoft indirect reseller business is not ECIF-ready (determined by your Microsoft field contact) or you don’t have the in-house resources to deploy applicable workloads, Pax8 Professional Services can support your project.
Download the Azure Frontier Offer FAQ sheet and reach out to your Pax8 account team for support on nominating your project.
Earn More With Microsoft Azure Programs, Scaled by Pax8
One of the most profitable ways to earn more with Azure is by earning rebates simply by hitting growth milestones within one of Microsoft’s Azure rewards programs. Rewards are based on incremental growth of Azure Consumed Revenue (ACR) targets, and there are no penalties for missing milestones. It’s low-risk, high-reward and a great way to supplement on-premises business while benefitting from the cloud simultaneously.
Datacenter Optimization (DCO)
If you already have a mature Azure practice with datacenter migration opportunities in the pipeline, take a look at the DCO program. This program is best for partners entering accelerated growth in Azure over the next 12 months.
Indirect Activation Reward (IAR) programs
Partners still in the early growth stages of their Azure journey are better suited for IAR, the shorter version of DCO. This program is for Service Provider Licensing Agreement (SPLA) hosting partners that report under $10k in monthly ACR.
The goal is to transact increased ACR thresholds over three consecutive months. For each successful milestone reached (and maintained for three consecutive months), the partner is rewarded with a credit on their invoice.
How Pax8 Helps
Partners who commit to an agreed-upon Azure growth target with Pax8 gain access to:
- Significant offers and rebates
- Engineering escalation support
- Azure deal support and review
- Migration planning and tooling
If you’re a Pax8 partner interested in the DCO or IAR program, reach out to your Pax8 rep to see if you qualify.
SPLA + Azure Arc: A Hidden Profit Engine for Clients Not Ready to Fully Migrate
For MSPs supporting SQL Server customers who can’t migrate immediately, Azure Arc-enabled SQL creates an opportunity to build new cloud-native applications on any infrastructure, including existing on-premises environments and even across other public clouds. This enables customers to make the most of their legacy applications, with the flexibility to innovate quickly and save on costs.
SPLA list pricing matches Azure Arc monthly pricing, so you can turn on Arc-enabled SQL at no extra cost while earning CSP economics. Plus, by transacting through the CSP program, you can earn its 3% Azure incentive. And for a limited time, Pax8 Microsoft partners can nominate their SQL-Arc project to receive post-sales funding through the Azure Frontier Offer.
This model is ideal to begin the migration discussion with your clients while opening the door for future cloud transformation — and generating new recurring revenue before the cloud migration even begins.
Grow Beyond the First Migration
Cloud transformation is an ongoing journey. Once core infrastructure is in Azure, you can expand your reach even further with those clients by leaning into advanced workloads that drive long-term AI innovation. These kinds of advanced deployment discussions help you present yourself as a strategic partner to your clients.
Plus, as a Pax8 Microsoft partner, you can tap into funding and implementation support through the Azure Accelerate program and Azure Frontier Offer. Ask your Pax8 rep how to get qualified for advanced workload deployments with Azure Accelerate.
Microsoft Fabric
For partners, Fabric introduces an opportunity to add value for small and medium-sized business (SMB) clients while building recurring revenue and laying the groundwork for future AI adoption. Fabric is an all-in-one analytics platform delivered as a cloud service, bringing together:
- Data integration (Data Factory, with connectors from over 300 sources such as CRM, Excel, QuickBooks, etc.)
- Unified storage (OneLake)
- Analytics and BI (Power BI with premium capabilities)
- AI and automation (built-in Copilot assistance)
- Advanced capabilities (data warehousing, real-time analytics, machine learning)
Position Microsoft Fabric as the unified platform that transforms scattered data into their most valuable asset — and the foundation for AI-powered growth. Check out our previous blog outlining the most relevant Fabric scenarios for SMBs, and join one of our technical hands-on labs or enablement overview sessions to learn more.
Azure Foundry
AI adoption is accelerating, and AI agents that can work semi-autonomously are at the forefront of every discussion. In fact, IDC projects that 1.3B AI agents will be in the market by 2028. But, there are challenges organizations face before fully realizing the benefits of AI apps and agents, such as:
- Disjointed developer tools
- Decision fatigue from too many model options
- Scalability
- Security and governance
Azure Foundry empowers developers to easily build, customize and scale AI apps and agents, all while being backed by Microsoft’s built-in security. With Foundry, SMBs can automate business processes by building agents with popular low-code options like Copilot Studio, while enterprises can use Foundry to build commercial AI solutions with GitHub and other pro-code tools.
Questions? Join one of our hands-on labs to learn how to build AI agents in Foundry from start to finish.
Azure Security
With all of these developments, security should remain at the forefront. And Azure provides unified end-to-end security coverage across identity, device, data and infrastructure with Azure-native security to boost security features with Microsoft 365 E5 licensing.
In addition, Defender for Cloud adds workload protection, hybrid cloud risk visibility and automated hardening recommendations, while Microsoft Sentinel adds scalable SIEM capabilities with AI-driven threat correlation across Microsoft 365, Azure and third-party security signals.
Join one of our Microsoft security sessions to level-up your security posture with Azure.
Bringing it all together
Having a long-term cloud growth strategy for each client will not only set you up for increasing monthly recurring revenue but will accelerate your clients’ business transformation, positioning you as a strategic advisor — not just a tech vendor.
Partners that embrace Azure‑driven growth pathways and tap into Microsoft’s incentive programs, along with the Pax8 enablement ecosystem, are building a growth strategy rooted in long‑term customer value. These partners can unlock higher profitability, streamline deployments and deliver AI‑ready solutions with confidence.
Whether it’s maximizing Azure rebates, leveraging funding towards eligible projects or expanding into advanced workloads, the catalysts for growth are available to those that know where to look.
By aligning with the right programs and partners, you can build a resilient, scalable Azure cloud practice that transforms client outcomes and fuels your own sustainable success. Now is the time to lean in and capture the momentum waiting in your Azure practice.
