Ask a room of Microsoft Partners about Co-Op funding and you’ll hear the same things repeated: it’s complicated, it’s time consuming, it’s a bit of a dark art.
What’s talked about far less is what that uncertainty actually costs, in time, confidence, and decisions not taken. When Partners don’t feel sure how Co-Op works, marketing activity gets delayed, budgets stay conservative, and money that was meant to support growth quietly expires.
We see this first-hand at Bright Star. Partners know the funding exists. Some even know how much they’ve earned. But the rules feel opaque, the systems intimidating, and the consequences of getting it wrong feel disproportionate. So Co-Op slips down the list, until a deadline looms and pressure kicks in.
That context is what led us to sit down with Rob Smith, founder of Pargentic, as part of our new strategic partnership.
Rob works with Microsoft Partners every day, helping them understand what they’ve earned, how Co-Op funding really operates, and how to avoid money quietly expiring through confusion or inaction. His focus is on removing risk, friction, and wasted effort.
Together, Bright Star and Pargentic bring two complementary strengths. Pargentic helps partners navigate the mechanics — incentives, eligibility, Partner Centre, and claims. Bright Star focuses on executing marketing content that’s audience-first, clearly delivered, and easier to stand behind at claim stage.
In the conversation below, we talk candidly about why Co-Op funding goes unused, what partners are really worried about, how the six-month funding cycles work, and where marketing content, even when well-intentioned, can create avoidable risk if it isn’t clearly executed.
This isn’t a how-to guide. It’s an honest discussion about how to think more clearly about Microsoft Co-Op-funded marketing, and how to move forward without making things harder than they need to be.
Juliet Stott: Why does Microsoft Co-Op funding so often go unused by partners who are actually eligible?
Rob Smith (RS): Because most Partners either don’t realise they’re earning it in the first place, or they know it exists but don’t really understand how to get hold of it.
A lot of partners see Co-Op as “Microsoft money”, when in reality it’s money they’ve already earned through selling licences and Azure via CSP. The problem is, it doesn’t just turn up in your bank account. You have to go and claim it.
And unless you’re deep into Microsoft’s incentive world, which most Partners aren’t, and frankly shouldn’t have to be, it’s very easy to miss. The guidance alone runs to hundreds of pages. If you’re busy delivering real work for customers, Co-Op slips down the priority list very quickly.
Juliet Stott: When partners come to you feeling unsure about Co-Op, what are they usually most worried about — even if they don’t say it directly?
RS: They’re worried about losing money.
Their biggest fear is: “We’ve earned this, but we’re going to lose it because we don’t know what qualifies, or we don’t have the time or resource to spend it properly.”
There’s also anxiety around rejection. Partners worry they’ll run activity, submit a claim, and then be told it doesn’t qualify, and often at that point it’s too late to do anything about it. That fear alone is enough to stop people doing anything at all.
Juliet Stott: How much of the challenge is about the funding rules themselves, and how much is about navigating Partner Centre?
RS: It’s both.
The rules are complicated. Not impossible, but full of nuance. Microsoft uses very specific language, and until you understand what they mean rather than just what’s written, it’s easy to misinterpret things.
Partner Centre then adds another layer. It’s getting better all the time, but it’s still not necessarily intuitive. Submitting a claim is part art, part science. Two claims for the same activity can get different outcomes depending on how they’re worded and what evidence is attached.
And the reality is: Partners aren’t Microsoft funding experts. They’re experts in delivering services and value to their customers. This isn’t their day job, and it shouldn’t have to be.
Juliet Stott: From what you see, what types of marketing activity tend to be least risky when it comes to claiming Co-Op funding?
RS: The least risky activities are the ones that are 100% Microsoft focused and assessed for eligibility ahead of time.
Things like Partner programme fees, solution designation fees, Partner benefits packages — these are all fully reclaimable. You know the cost. You know it qualifies. You submit the invoice and get the money back.
That’s why I often say, the first rule is to turn Microsoft dollars into Partner dollars. Once that money’s back in your account, it’s yours. You can then decide how to spend it.
The irony is that these low-risk activities don’t always drive the biggest marketing impact, but they do remove risk and stop money expiring unused.
Juliet Stott: What are the most common mistakes Partners make when they try to use Co-Op funding for content marketing or campaigns?
RS: The biggest mistake is executing on activity that is great for the Partner, but not properly tied to Microsoft.
In the strict context of Co-Op, Microsoft doesn’t care if you sold managed services or a fantastic new application. They care whether you drove adoption, usage, or sales of their technology. If the activity can’t clearly answer “what’s in it for Microsoft?”, it’s probably not claimable.
The second big mistake is bundling in third-party products without understanding the impact. That doesn’t mean you can’t do it, but it changes what you can reclaim, and a lot of Partners only realise that too late.
Juliet Stott: Why does marketing activity that looks good on paper sometimes become harder to evidence later?
RS: Because Co-Op is transactional.
At claim stage, Microsoft isn’t judging creativity or effectiveness. They’re checking invoices, evidence, and whether the activity meets the criteria. If you can’t prove what was delivered, when it ran, and how it aligns to Microsoft solutions, it doesn’t matter how good the idea was.
That’s where Partners often come unstuck, especially if campaigns were rushed or loosely defined upfront.
Juliet Stott: What’s the biggest misconception Microsoft Partners have about Co-Op claims and approval?
RS: That Microsoft cares whether the campaign worked.
They don’t. From a Co-Op perspective, success isn’t measured in leads or ROI. It’s measured in eligibility and evidence. You could spend £10,000 on a campaign that generates zero leads, if it meets the criteria, it’ll be paid.
Of course, Partners care about impact, and they should. Likewise, Microsoft wants every Partner to be successful and drive the best impact possible, but in the strict context of Co-Op, adherence to the rules is more important than the specific success of the activity. But that’s a separate conversation to whether something is claimable.
Juliet Stott: If a Microsoft Partner is feeling unsure where to start with Co-Op-funded marketing, what’s the most sensible first step you’d recommend?
RS: Understand what you’ve got.
Not just how much Co-Op you have, but how you earned it and how that might change in future. Most Partners know the balance but not the mechanics behind it.
Once you’ve got that clarity, you can make better decisions about where to spend it, weighing risk versus impact, and get help where needed so it doesn’t become a distraction from running the business.
That early clarity also lets you plan ahead to spend your Co-Op dollars on the right activities, that will in turn earn you more incentives further down the line.
That’s really the goal: remove the worry, stop money expiring, and let Partners focus on what they’re actually good at, helping their customers and clients to succeed.
How Microsoft Co-Op funding cycles actually work
Co-Op works in six-month cycles, and you’re always doing two things at once: earning in one period and spending in the next.
Here’s the simple version.
- You earn Co-Op over a six‑month period based on CSP licence and Azure consumption incentives.
- That earned amount is then locked and becomes available to spend in the following six‑month period.
- Any Co-Op that isn’t claimed and spent in that spend window expires. There’s no rollover.
So, for example:
- Earn between January–June → spend between July–December.
- Earn between July–December → spend between January–June.
Once you’re in the programme, you’re always accruing and spending in parallel. There isn’t a quiet period where nothing’s happening, it just feels that way if you’re not looking at it regularly.
Where Partners get caught out is assuming they can claim for activity that happened during the earning period. You can’t. The activity you claim for has to take place during the spend period, even though the money was earned earlier.
That’s why month five panic happens. Partners suddenly realise what’s sitting there, but the window to use it properly is already closing.
The Partners who do this well don’t treat Co-Op as an annual event. They treat it as a rolling six‑month discipline, checking what they’ve earned, what’s coming, and what they want to use it for well before deadlines appear.
Practical Do’s and Don’ts for Using Co-Op-Funding for Content Marketing
Do
- Do treat Co-Op as earned money. You’ve already earned it via CSP. The job now is to claim it, not admire it.
- Do start with low-risk, pre-qualified claims. Partner programme fees, solution designation fees, partner benefits — easy wins that turn Microsoft dollars into partner dollars.
- Do decide eligibility upfront. Ring‑fence activity as 100% Microsoft before you start. It removes risk later.
- Do keep evidence. Invoices, dates, proof of execution, correct product names. That’s what gets paid.
- Do separate impact from eligibility. Aim for impact, but don’t confuse it with claim approval — they’re different conversations.
- Do get help if this isn’t your day job. Time spent second‑guessing claims is usually more expensive than getting it right first time.
Don’t
- Don’t wait until month five. That’s when Partners panic, rush activity, and lose money.
- Don’t assume a good idea equals a valid claim. Creativity doesn’t matter if it doesn’t meet the criteria.
- Don’t bundle third‑party products without thinking. You can do it — just understand how it caps what you can reclaim.
- Don’t write campaigns for yourselves only. If you can’t answer “what’s in it for Microsoft?”, expect problems.
- Don’t overthink outcomes at claim stage. Microsoft isn’t judging ROI — they’re checking compliance and evidence.
What this means for Co-Op-funded marketing content
If this conversation has resonated, the question usually isn’t whether to use Co-Op funding, it’s how to apply it to marketing content without creating stress or rework later.
That’s exactly what our Demand Generation Content Packages are designed to support.
They focus on executed, published marketing content that’s:
- clearly Microsoft-aligned
- straightforward to evidence
- tightly scoped to reduce risk
For Partners who want additional reassurance, our strategic partner Pargentic can also support Partner Centre and claims once activity is live.
If you’d like to see what that looks like in practice, you can explore our Demand Generation Content Packages here.
