Microsoft Overhauls Azure Startup Program, Impacting AI Ventures

Microsoft changes conditions for Azure startup credits

Microsoft has retired its program that granted incorporated AI startups with a validated business plan up to $150,000 in Azure credits and replaced it with a two-track system. The Microsoft for Startups program, which Redmond was promoting at RSA in May, was generous and a good way to drive young companies with AI ideas onto its cloud platform. But as of Tuesday, that multi-tier model has been phased out: existing activated credits remain valid until they expire, but newcomers now face stricter limits. Startups backed by an affiliated investor enter the Microsoft for Startups Investor Network track, which starts with $100,000 in Azure credits and can unlock additional awards based on referral source and engagement. Alternatively, early-stage teams without funding may qualify for up to $5,000 of Azure credits. For founders who'd budgeted runway around the old $150K ceiling, the June 27 announcement was a rude shock. "By introducing two distinct paths -- a streamlined, self-service experience for earlier-stage startups, and a higher touch experience for investor-backed startups, we're making it easier for every founder to access the right resources, at the right time," Redmond said in the post announcing the changes. One startup founder who spoke to The Register on condition of anonymity praised the old program, but said some warning would have been useful as this has wrecked budgets and may sink the entire project. "We're in for close to $80,000-$100,000 at this point on costs outside of Azure," they said. "Everybody was like 'we believe in this idea, and we think we can get this thing off the ground,' but this business plan was sort of tied to this runway through Azure." Part of the problem, the founder explained, was that once you've actually built around Azure, switching to another platform causes a host of problems. They accepted that part of the reason Microsoft was offering such a deal was to lock people into Azure, but the abrupt shift with no warning is causing massive problems. I'm not contesting the legality of their choices. It's just that, you know, this is people's lives you're playing with "I'm not contesting the legality of their choices. It's just that, you know, this is people's lives you're playing with," the founder told us. "If someone has taken it seriously enough to get to this point, maybe they need to just stop accepting new applications and give everyone a few months' notice, that's fair enough. If you really kind of hitch your business plan to a program and then it abruptly disappears, that's pretty catastrophic." Redmond said that it isn't changing its Pegasus Program, an invitation-only group of people who are already working within the Microsoft for Startups program. Pegasus links startups to Microsoft sales and assigns them a dedicated Cloud Solutions Architect to act as tech support. But overall, the changes mean there's very little middle ground for startups seeking financial incentives from Microsoft to use its cloud platform. There's $5,000 Azure credits for the early stages, and then you're on your own until you can attract investors. Thankfully, there are at least other options, even if it means reworking an application. Google for Startups Cloud Program is offering $200,000 in cloud credits, and $350,000 if it's an AI idea, as well as advice from staffers. Amazon too has its AWS Activate program offering up to $100,000 in credits, or up to $300,000 additional credits for startups using Trainium or Inferentia. Microsoft had no comment at the time of going to press. ®

Microsoft pulls program that gave a generous Azure boost to AI startups

Microsoft has pulled the plug on a popular program designed to support startups by offering them up to $150,000 in Azure credits, according to a new memo posted on 27 June, 2025, but it's not gone forever. Instead, the company is making changes to the program - Microsoft will continue to support startups, but this time via a two-track system that gets its support from investors as well as the company itself. Microsoft stressed existing activated credits remain valid until they expire, however new applicants will be guided down the two-track system, which came info effect on July 1. The new program will first consist of an investor-backed track - arguably the most valuable to startups. It consists of $100,000+ in Azure credits, but requires a referral from an affiliated investor, such as accelerators, venture capitalists and universities. Eligible startups can also unlock additional benefits based on program engagement and their investor. Dedicated support channels, co-marketing initiatives and tailored resources are also available. Secondly is the self-service track, which is open to startups with no investor backing that are new to Azure. Up to $5,000 in Azure credits are available, comprising $1,000 that are available for 90 days upon signup and a further $4,000 that remain available for 180 days after business verification. However, there is no dedicated support on this track - it's self-serve only. The abrupt change could cause disruption to many startups who may have already budgeted based on the previous $150,000 credit availability, with most startups unlikely to refocus their strategies given the short notice period. It's unclear how the changes could affect Microsoft's model, too, with Google offering up to $200,000 in credits (or $350,000 for eligible AI startups) and AWS offering up to $100,000 and an additional $30,000 for startups using AWS Trainium or Inferentia.