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If you're an independent software vendor (ISV) selling on the Microsoft Marketplace, understanding the difference between "co-sell ready" and "Azure IP co-sell eligible" is critical to unlocking revenue, pipeline acceleration, and Microsoft seller engagement.
This guide breaks down what each co-sell status means, the requirements to qualify, what changed with the new unified Microsoft Marketplace, and how to position your business for maximum growth in 2026.
What Is Co-Selling with Microsoft?
Co-selling is Microsoft's collaborative selling model in which Microsoft's own sales teams and over 500,000 partners work together with ISVs to sell solutions to enterprise customers. When you co-sell, Microsoft sellers actively promote your solution to fill gaps in their customers' cloud technology stacks — creating a win-win for Microsoft, the ISV, and the customer.
Co-selling is one of the most effective ways for ISVs to tap into Microsoft's massive enterprise customer base and accelerate cloud GTM goals.
Understanding the four co-sell statuses
Microsoft defines four progressive co-sell statuses for ISV solutions. Each level unlocks additional benefits and visibility:
1. In Market: Your offer is published and live on the Microsoft Marketplace, but you have not yet met the requirements for co-sell-ready status.
2. Co-Sell Ready: You have met all baseline requirements, and your solution is now visible to Microsoft's internal sales teams. This is the first level where active co-selling begins.
3. Azure IP Co-Sell Eligible: You have met additional revenue, technical, and transactability requirements. This unlocks MACC eligibility, stronger Microsoft seller incentives, and premium Marketplace benefits.
4. Business Applications Co-Sell Eligible: A separate track for solutions built on Dynamics 365 apps on Dataverse, Power Apps, and Dynamics 365 Operations Apps, enrolled through ISV Success.
This guide focuses on the two statuses most relevant to Azure-based ISVs: Co-Sell Ready and Azure IP Co-Sell Eligible.
Co-Sell Ready: Requirements and Benefits
What Does Co-Sell Ready Mean?
Achieving co-sell-ready status means your solution appears in Microsoft's internal seller catalogs. Microsoft sales representatives can see your offer and actively pitch it alongside Microsoft products when working with enterprise customers.
Requirements for Co-Sell-Ready Status
To achieve co-sell-ready status, an ISV must complete the following:
1. Have a PartnerID and an active Microsoft Marketplace account in Partner Center: Formerly known as the MPNID, a PartnerID is your unique identifier within the Microsoft partner ecosystem. You'll also need a commercial marketplace publisher account.
2. Complete your business profile in Partner Center: Your Partner Center business profile is how Microsoft sellers and potential customers discover your company. It should be thorough, accurate, and up to date.
3. Publish your offer live on the Azure Marketplace: Your offer must be live on the Microsoft Marketplace. It can be any eligible offer type — SaaS, Azure Application, Azure Virtual Machine, Azure Container, or others supported by Partner Center. Offers of type "Contact Me" (non-transactable) are still eligible for co-sell-ready status, though transactable offers unlock more benefits.
4. Provide a sales contact for each co-sell-eligible geography: Microsoft needs to know who to contact on your team when a co-sell opportunity arises in a specific market.
5. Submit required co-sell collateral on the Co-sell > Solutions page in Partner Center: This includes a one-page solution summary (one-pager) and a pitch deck. Microsoft provides templates for both. These documents are reviewed (both automated and manual) before co-sell status is granted.
Important Notes
- Apps and add-ins for Microsoft Office (Teams, Outlook, Excel) are not eligible for co-sell-ready status.
- Services partners (professional services) must hold at least one Solutions Partner designation in the MAICPP.
- Business Applications ISVs must have ISV Success enrollment for Dynamics 365 and Power Apps solutions.
Benefits of Co-Sell-Ready Status
Once co-sell ready, your solution gains visibility across Microsoft's sales organization, meaning Microsoft sellers can discover and recommend your product to their enterprise accounts. This alone can be a significant growth driver, especially for ISVs trying to break into new enterprise segments.
Azure IP Co-Sell Eligible: Requirements and Benefits
What Does Azure IP Co-Sell Eligible Mean?
Azure IP co-sell eligible status is the next level above co-sell ready — and it's where the most significant financial and sales benefits unlock. At this tier, Microsoft sellers are incentivized to sell your solution, your offer becomes eligible for MACC burn-down, and you gain access to premium Marketplace benefits.
Requirements for Azure IP Co-Sell Eligible Status
After achieving co-sell-ready status, ISVs must meet four additional requirements:
Requirement 1: Revenue threshold — $100,000 in trailing 12 months. At the organization level, you must generate at least USD $100,000 of Azure Consumed Revenue (ACR) or Marketplace Billed Sales (MBS) over the trailing 12-month period. This can be met through a combination of Azure solutions. Note: Azure credits and Azure Consumption Offers (ACO) do not count toward this threshold.
Requirement 2: Microsoft technical validation. Your solution must pass Microsoft's Azure-platformed technical validation, confirming that the offer is primarily built on Azure and meets Microsoft Marketplace certification policies. This validation is a subset of the reference architecture diagram review process.
Requirement 3: Provide a reference architecture diagram. You must upload a reference architecture diagram along with your co-sell documents in Partner Center. This diagram visually demonstrates how your solution integrates with Azure services. Note: This is not mandatory for Azure App, Container, or VM offer types.
Requirement 4: Offer transactability on the Microsoft Marketplace. Effective July 11, 2023, new offers must be transactable (meaning Microsoft processes the billing and payment) to qualify for IP co-sell eligible status. Free and BYOL (bring your own license) offers do not qualify.
Eligible Offer Types
Azure IP co-sell eligible status applies to the following offer types:
- Azure Application
- Azure Container
- Azure Virtual Machine
- Software as a Service (SaaS)
The solution type for your offer must be "IP" (intellectual property) to qualify.
Benefits of Azure IP Co-Sell Eligible Status
This is where the return on investment becomes substantial:
MACC eligibility: Your offer becomes eligible to decrement enterprise customers' Microsoft Azure Consumption Commitments. This is one of the most powerful enterprise sales levers in the Microsoft ecosystem. Customers with MACC agreements actively seek out eligible solutions because purchases count toward their committed Azure spend — reducing procurement friction and accelerating deal cycles.
Microsoft seller incentives: Microsoft sales reps earn quota credit when they sell Azure IP co-sell eligible solutions. This creates a direct financial incentive for Microsoft's massive field sales organization to actively promote your product.
Premium Marketplace benefits: Eligible offers gain access to enhanced Marketplace Rewards, including marketing support, listing optimization, featured placement, and co-branded campaign resources.
Enterprise customer access: Enterprise buyers with cloud commit budgets actively browse for MACC-eligible solutions. Being listed as eligible immediately expands your addressable market.
Accelerated deal cycles: By routing through the Microsoft Marketplace, you bypass many of the procurement delays common in enterprise deals — simplified legal review, streamlined contracting, and no need to manage international tax or currency complexities.
Referral pipeline: IP co-sell eligible ISVs can submit co-sell referrals in Partner Center, and as of January 2026, the "Marketplace Intent" field is mandatory for all API-based co-sell referral submissions, ensuring higher data quality and better deal tracking.
Co-Sell Ready vs. Azure IP Co-Sell Eligible: Side-by-Side Comparison
How to Get Started: A Step-by-Step Roadmap
Step 1: Enroll in the Microsoft AI Cloud Partner Program. Sign up at Partner Center, get your PartnerID, and complete your business profile.
Step 2: Enroll in ISV Success. ISV Success is free for 12 months (with a $1,500/year renewal after that) and provides Azure credits, developer tools, technical consultations, and publishing support.
Step 3: Build and publish your offer on the Microsoft Marketplace. Choose the right offer type (SaaS, Azure Application, VM, Container) and publish it as a transactable offer. Transactability is essential for IP co-sell eligibility.
Step 4: Prepare co-sell collateral. Create your one-pager, pitch deck, and reference architecture diagram. Use the templates provided by Microsoft in Partner Center.
Step 5: Achieve co-sell-ready status. Submit your collateral, provide sales contacts, and ensure all co-sell requirements are met.
Step 6: Work toward Azure IP co-sell eligibility. Build revenue toward the $100K threshold, complete the technical validation, and ensure your offer meets all four IP co-sell requirements.
Step 7: Maximize your Marketplace presence. Take advantage of Marketplace Rewards, optimize your listing, and leverage MACC eligibility to attract enterprise customers.
Speak to a Clazar expert and understand how you can co-sell successfully with Microsoft.
What's Coming in 2026: App Accelerate and Simplified Co-Sell Pathways
Microsoft announced at Ignite 2025 (November 2025) a new unified program for software companies called App Accelerate, expected to become available in 2026. App Accelerate will combine ISV Success, Marketplace Rewards, and other benefits into a single streamlined pathway.
Key highlights include:
Unified entry point. Instead of navigating ISV Success and Marketplace Rewards as separate programs, App Accelerate creates one simplified experience.
Early co-sell access pathway. Microsoft is creating an additional route for ISVs to access co-sell benefits even if they haven't yet reached the $100K ACR/MBS milestone. This nomination-based pathway considers factors like MACC customer traction, pipeline strength, and partner readiness.
Qualified Referral Program (QRP) retirement. Microsoft announced in January 2026 that it will retire the QRP in Q3 FY26 and consolidate all referral intake into the standard Partner Center co-sell experience. Partners should begin using Partner Center Referrals for all new opportunities.
AI-enhanced partner matching. Microsoft is enhancing the partner matching process with real-time data and AI logic to better connect leads with the right partners based on capabilities and competencies.
Estimated ACR field in referrals. A new "Estimated Azure Consumed Revenue" field is now generally available in the referral submission experience, helping Microsoft sellers prioritize high-potential cloud marketplace deals.
Frequently Asked Questions (FAQ)
What is co-selling with Microsoft?
Co-selling with Microsoft is a collaborative selling model where Microsoft's sales teams work alongside ISV partners to sell solutions to enterprise customers. Microsoft sellers actively promote partner solutions to fill technology gaps in their customers' cloud environments.
What is the difference between co-sell ready and IP co-sell eligible?
Co-sell ready is the baseline status that makes your solution visible to Microsoft sellers. Azure IP co-sell eligible is a higher tier that additionally qualifies your offer for MACC burn-down, provides Microsoft sellers with quota credit incentives, and unlocks premium Marketplace benefits. IP co-sell eligible requires meeting a $100K revenue threshold, passing technical validation, and having a transactable offer.
What is MACC and why does it matter for ISVs?
The Microsoft Azure Consumption Commitment (MACC) is a contractual agreement where enterprise customers commit to spending a specific amount on Azure over a defined period (typically one to three years). When your offer is MACC-eligible (through IP co-sell eligible status), customers can apply purchases of your solution toward their committed Azure spend. This significantly reduces procurement friction and makes your solution more attractive to enterprise buyers.
What is the $100K revenue requirement for IP co-sell?
To achieve Azure IP co-sell eligible status, your organization must generate at least USD $100,000 of Azure Consumed Revenue (ACR) or Marketplace Billed Sales (MBS) over the trailing 12-month period. Azure credits and ACO do not count.
What changed with the new Microsoft Marketplace in 2025?
On September 25, 2025, Microsoft unified Azure Marketplace and AppSource into a single platform called the Microsoft Marketplace. This consolidation simplifies the buying experience, adds a dedicated AI Apps and Agents category, and integrates solutions directly into Microsoft products. Co-sell requirements and Partner Center workflows remain unchanged.
What is App Accelerate?
App Accelerate is a new unified program for software development companies, announced at Microsoft Ignite in November 2025 and expected to launch in 2026. It combines ISV Success, Marketplace Rewards, and co-sell resources into a single streamlined pathway, with an early access route for co-sell benefits based on factors beyond just the $100K revenue threshold.
What is the difference between cross-sell and co-sell?
Co-selling requires two businesses (in this case, Microsoft and the ISV partner) to work together to sell to shared prospects or customers. Cross-selling is a single company selling supplementary products to its existing customers without requiring a partner relationship.
Are Office add-ins eligible for co-sell?
No. Apps and add-ins for Microsoft Office products (Teams, Outlook, Excel, etc.) are not eligible for co-sell-ready status.
