287 – The $300B Marketplace Shift: Why Agents, REO, and the Channel Will Decide Who Wins

Subscribe to our Newsletter: https://theultimatepartner.com/ebook-subscribe/ Check Out UPX: https://theultimatepartner.com/experience/

https://youtu.be/-flNeKF6CxQ?si=xIIQ4LUl7oraQjkg

Microsoft’s Cyril Belikoff joins Vince Menzione to reveal the seismic shift occurring within the newly reimagined Microsoft Marketplace. As the industry moves toward a predicted $300 billion partner opportunity by 2030, this discussion deconstructs the evolution of the “Frontier” vision, the launch of the AI apps and agents category, and the critical “Resale Enabled Offer” (REO) that is currently doubling deal sizes for early adopters. Whether you are a software company looking to scale globally or a reseller aiming to stitch together complex AI solutions, the message is clear: the flywheel is already spinning, and those who wait for a “perfect strategy” risk being permanently displaced by more agile competitors who are getting their feet wet today.

Key Takeaways

• The Microsoft Marketplace has been reimagined into a single destination for discovering, buying, and deploying AI apps and agents.
• Analysts predict a staggering $300 billion opportunity for partners within the Microsoft Marketplace by 2030.
• The new Resale Enabled Offer (REO) allows software companies to authorize channel partners to resell on their behalf across specific geographies with minimal overhead.
• Cloud migration is far from over, as massive amounts of on-premise data and ISV apps still need to be modernized for the AI era.
• Marketplace deal sizes are doubling as customers use Azure commitments to retire their marketplace acquisition costs.
• Successful partners are moving away from “boiling the ocean” strategies and instead focusing on transacting one or two deals to learn the ecosystem’s mechanics.

If you’re ready to lead through change, elevate your business, and achieve extraordinary outcomes through the power of partnership—this is your community. At Ultimate Partner® we want leaders like you to join us in the Ultimate Partner Experience – where transformation begins.

Key Tags:

Microsoft Marketplace, AI apps and agents, Resale Enabled Offer, REO, Cyril Belikoff, Azure Marketplace, AppSource, cloud solutions, software companies, digital transformation, AI strategy, channel led sales, ISV solutions, cloud migration, Azure commitments, Microsoft Cloud, Frontier vision, MSP opportunity, marketplace transacting, AI monetization, global scale, procurement, IT deployment, technical modernization, partner ecosystem, business applications.

Opening Lines:

[00:00:00] Cyril Belikoff: Marketplace is really the extension of our vision for Frontier, uh, and the Microsoft Cloud. You know, the, the Microsoft technology takes a customer a long way, but in many ways to complete the thought. If you’re in football terms, you want to cross over the line and score touchdown. You can’t just get, uh, to the red zone.

[00:00:20] Cyril Belikoff: You actually need partner solutions.

[00:00:26] Vince Menzione: So let’s, let’s kick off to Marketplace a little bit right, too, because, uh, it’s been a big year for Marketplace, or 20, the first half of 2026 fiscal year 2026 has been a big year. A lot of announcements, a lot of things going on in the world, in marketplace. Where do we wanna start there? Let’s recap some of it.

[00:00:44] Cyril Belikoff: Yeah. Um, so, um. It feels like a long time ago, but in, at the end of September,

[00:00:51] Vince Menzione: yeah.

[00:00:52] Cyril Belikoff: Um, at the AR tour, uh, in Chicago, we announced a new Microsoft marketplace. We reimagined that experience. It’s a new customer experience, single destination for customers to. You know, discover, find, try, buy, and deploy cloud solutions, AI apps and agents all in one place.

[00:01:11] Cyril Belikoff: And so historically, we’ve had a little bit, uh, of decentralization. We had this thing called the Azure Marketplace and AppSource for different experiences. AppSource was more for teams and, and copilot. Um, and, and office, Azure Marketplace. Of course, that was for Azure. We brought all of that into one place.

[00:01:30] Cyril Belikoff: So customers, whether they are looking for a SaaS solution running on Azure, an agent that snaps into copilot, an experience that runs in our security store, now they can go to one place. Um. marketplace.microsoft.com. It’s one, it’s the new Microsoft marketplace. And we have an, of course, we have a, we had, we launched a brand new category, AI apps and agents, and we launched that category in September.

[00:01:54] Cyril Belikoff: Uh, bringing together numerous, uh, uh, partner offerings. Yeah. And today we have the largest catalog, um, probably in the mid four thousands of AI and agents. Wow. Available to customer. So fantastic. There was, there was quite a big moment in September. Um, and then fast forward a little bit to November, we announced a resale enabled offer, um, at Ignite

[00:02:15] Vince Menzione: eo.

[00:02:16] Vince Menzione: Eo

[00:02:16] Cyril Belikoff: eo. I,

[00:02:17] Vince Menzione: I like EO reminds me of the band back in the day.

[00:02:19] Cyril Belikoff: Yeah. R Speedwagon. There you go. Uh, well, and it’s, it’s not that far from it because Oreo accelerates. Yeah. Um, what partners can do, uh, with the marketplace and really connects. Software companies and resellers, which I’m sure we’ll talk about in a second.

[00:02:34] Cyril Belikoff: But that’s really the recap, um, of, uh, you know, the new Microsoft marketplace, how we enabling it for, uh, for partners through the the resell enable offer.

[00:02:45] Vince Menzione: So, I know we talked on this a little bit, but I wanna maybe just expand on it. What does the frontier push and the marketplace evolution mean for partners?

[00:02:53] Vince Menzione: Because I, I think it’s huge for both, for these partners to really monetize and accelerate their success working with you.

[00:03:00] Cyril Belikoff: Yeah. So, um. Marketplace is really the extension of our vision for Frontier, uh, and the Microsoft Cloud. You know, the, the Microsoft technology takes a customer a long way, but in many ways to complete the thought and to, you know, uh, uh.

[00:03:20] Cyril Belikoff: If you’re in football terms, you wanna cross over the line and score a touchdown, you can’t just get, uh, to the red zone. You actually need partner solutions.

[00:03:28] Vince Menzione: Yeah.

[00:03:29] Cyril Belikoff: Uh, and so that’s where the partner solutions, combined with Microsoft’s first party offerings become a really, really. Great offering and powerful offering for our customers to, to become Frontier.

[00:03:40] Cyril Belikoff: So we have obviously a ton of AI experiences, our own co-pilot experiences, uh, Microsoft Foundry, which is a platform for ai, but in, in many ways, we need those industry solutions. We need those AI apps and agents from partners to complete that offering. And that’s really. How it comes together and, uh, you know, uh, I heard you from o was just on before me.

[00:04:01] Cyril Belikoff: They actually predict that the Microsoft marketplace, uh, is a 300 billion partner opportunity by 2030. Yeah, they’re talking about, I think, mid eighties growth. We have literally seen our business for the last three years, and we are in the middle of our, uh, you know, third year doubling. And so when you get three or four years of doubling every year, that’s compounded doubling.

[00:04:24] Cyril Belikoff: Um, so, uh, we have seen lots of momentum from customers, lots of interest. We’ve made it, you know. Interesting for customers. Um, and incentivize our customers with their Azure commitments that can retire their marketplace, uh, acquisitions that way. We’ve made it, we’ve put incentives for partners and for our own sellers.

[00:04:44] Cyril Belikoff: So we really creating the flywheel for everybody in the market to see value from, uh, the marketplace. So. Like, like, like you mentioned, like m the, uh, you know, suggested

[00:04:55] Vince Menzione: Yeah.

[00:04:55] Cyril Belikoff: It’s only exploding the opportunity on marketplace.

[00:04:58] Vince Menzione: Well, and you both touched on the fact that the data is not in the cloud yet.

[00:05:02] Vince Menzione: Not all the data that needs to be in the cloud in order to drive the future of where we wanna go from a society. Mm-hmm. And from a business application perspective needs to be in the cloud. So huge opportunities for partners around data states, around securing that data, governing that data, and so on, on top of all the business applications,

[00:05:19] Cyril Belikoff: right?

[00:05:19] Vince Menzione: As promise. So incredible. Yep. So let’s

[00:05:22] Cyril Belikoff: talk about, yeah. The call migration. The call migration, people think that is over and it’s long from over because customers have plenty, uh, on premise, uh, not only Microsoft technology, but the, the, the, the software company or the ISV app that sits on top of it. Yeah.

[00:05:36] Cyril Belikoff: And that needs to be migrated, managed, modernized, um, and marketplace is a big part of that too. Um, but there’s so many services and, um, opportunities around it.

[00:05:45] Vince Menzione: Incredible opportunity. Let’s talk about the channel and the channel opportunity. You, you touched on this earlier, right? So this really lighting up the channel.

[00:05:53] Vince Menzione: I saw this loud and clear when we were at Ignite. Like this is a huge opportunity for the Es, for the resellers, for all the partners. And as part of REO, you’ve got huge opportunities you’re laying out for them for the 500,000 part partners. You know, we talk about the Bill Gates moment down here in Boca.

[00:06:09] Vince Menzione: This is where it all started. Uh, yep. How, how do you think about marketplace in the channel today?

[00:06:16] Cyril Belikoff: Yeah. You know, it’s, um, it’s vital. You know, we have a customer need, um, from. The smallest is small business all the way to enterprise. And the really, the only way we serve that, the only way we know how to serve that is with our partners from the largest of partners that serve our top enterprises down through, um, what we call small and medium and then down to our small business.

[00:06:41] Vince Menzione: Yeah.

[00:06:41] Cyril Belikoff: Um, and so, you know, we have seen our. You know, while our, we’ve seen a doubling of our business, we’ve seen three, three and a half to four x doubling of our channel led sales.

[00:06:53] Vince Menzione: Yeah.

[00:06:54] Cyril Belikoff: Um, over the last year. And so while our overall business is doubling, channel is accelerating even, you know, even more.

[00:07:02] Cyril Belikoff: And so there, there’s a need from our customers because they buy from our channel and there’s obviously a need from the channel. And so we created this resale enabled offer. As you mentioned, we, um. We announced private preview in September and launched GA at Ignite. So, you know, uh, November, just before Thanksgiving holiday and retail Enable offer is all about scale and how we connect a, a, an independent software vendor or a software company.

[00:07:27] Cyril Belikoff: To authorize a channel partner to resell on their behalf on a particular geography. And then that allows software companies to expand into new markets with very little overhead. And it allows the channel partners to create a set of offerings, not only from one partner, but you might have multiple software companies or applications that you stitch that are together to create an end-to-end customer offering or experience.

[00:07:51] Cyril Belikoff: And so we are seeing, we are seeing many to many relationships. So software companies might authorize many resellers, many markets they’re in, for example. Yep. And then resellers, um, they’re, they’re becoming authorized resellers from many software companies so that they can really stitch together, end into end solution.

[00:08:09] Cyril Belikoff: And it, we’re loving it and we are getting great feedback. It is early days for our global availability for, uh, re office, which. But we had partners that were literally waiting, um, uh, and waiting for deals. And within the first week there was, they were, uh, processing the, the Oreo deals at, at, at quite large scale already.

[00:08:31] Cyril Belikoff: So. We are excited about the feedback that we’re getting. We, as you know, we, we stay close to that feedback and we listen well, um, and adjust from it. So we got more work to do, but, um, it’s a great opportunity for, to connect our, our multiple types of partners, software companies, and resellers.

[00:08:48] Vince Menzione: Yeah, I agree.

[00:08:49] Vince Menzione: And you know, I talk to a lot of these organizations myself, and there is palpable excitement. In the channel from Distees that were sort of disengaged a couple of years ago, maybe, trying to figure out where they were gonna monetize. And the other way area that’s aligned to this as well is the Ms. P community.

[00:09:06] Vince Menzione: So these MSPs are getting bigger and bigger, and organizations like Accenture, Avanade, and ndl. Or becoming MSPs or creating Ms. P practices within their own firms. But there’s even these smaller MSPs, but many of ’em are getting to a billion dollars or more. These were little mom and pop companies years ago, but the customer so needs to have, you know, especially with ai, right?

[00:09:27] Vince Menzione: Because we’re in a constant state of evolution right now. I need somebody that can help me on the tooling and then also help me on, you know, getting the tooling to work. And so, uh, we’re seeing a lot of excitement from that. Community, which wasn’t really as engaged with Microsoft the way they that they are now.

[00:09:43] Vince Menzione: They’re really getting engaged in a big way.

[00:09:46] Cyril Belikoff: Yeah, it’s promising. Like you say, you know, the, the, we’re all learning this new AI world and obviously marketplace has taken off. We’ve had the classic SaaS solutions or cloud solutions on marketplace for a while, but really un having the local partner that’s close to the customer, what the customer’s trying to need to do and be able to connect the, the traditional.

[00:10:07] Cyril Belikoff: Software as a service applications with these new AI experiences and really, uh, stitch them together and help them operationalize, you know, in their own, you know, cus in their own terms and what they’re trying to, uh, do is so important. You know, um, and to your point there, there are large, they’re the large ones that are seeing opportunity on the marketplace.

[00:10:27] Cyril Belikoff: But the, you know, when you get down to, uh, medium and smaller businesses, they really need their local friendly resetter to help them.

[00:10:35] Vince Menzione: Yeah.

[00:10:35] Cyril Belikoff: Uh, so you’re right. We are seeing an, a new en energy engagement from not only our existing 500,000 partners, but a bunch of those new ones.

[00:10:44] Vince Menzione: So, uh, again, second week of 2026, and people are really just starting to wake up from the holidays.

[00:10:50] Vince Menzione: Now they’re getting ready for their s ks. All these partners are lining up and getting their teams aligned. Uh, you’re in front of them. Let’s have a conversation like what should they be doing better and differently? What do they need to go do now? It’s 2026.

[00:11:06] Cyril Belikoff: Yeah. Um, you know, first of all, if you’re a software company, you know, understand what the, the Microsoft marketplace can help you with, uh, can help you scale to global markets, remove burdens like tax, um, a processing, engaging with customers.

[00:11:21] Cyril Belikoff: Um, we’re seeing an acceleration and doubling of, uh, not an acceleration deals, but doubling of deal sizes, as you know, through the marketplace. Uh, and there. It helps with engagement at different types of companies, whether it’s, or different types of, uh, roles in a company, whether it’s a, a procurement person or an IT person or a business person.

[00:11:42] Cyril Belikoff: So, you know, get onto the marketplace, create offerings, um, and give us feedback. And then on the reseller side, um, also lots of opportunities, you know, register as, as a reseller, um, you know, understand the benefits and. The, the Azure sponsorships that we have available for you, that you can close deals with their, their, their credits and, and incentives that we provide to you.

[00:12:06] Cyril Belikoff: And then figure out how you do your first deal with a software company. Um, yeah. You know, a lot of people will say like, should I have a big strategy? And Yeah. Yeah. I mean, if you want to, that’s okay, but just getting into. Uh, the marketplace, figuring out one or two deals, transacting and seeing the opportunity is many ways the best way to do it and to learn it yourself.

[00:12:28] Cyril Belikoff: And then you figure out, okay, where, where’s the opportunity for me in this deal? Am I in the transaction? Uh, am I in the services around the transaction or combination? Um, and just getting your feet wet will get you going and, and, uh, get you learning.

[00:12:42] Vince Menzione: You know, I think about this in the, the time the partners are, they have this huge opportunity with Microsoft around marketplace and then thinking about how they build their own ecosystem.

[00:12:52] Vince Menzione: And like you said, don’t, don’t try and boil the ocean, right. Don’t try and do it all at once. Mm-hmm. But start out small, but understand, you know, work with the Microsoft teams, understand how, how co-selling works, how to engage with the, with the Microsoft organization. How to, how to be up on marketplace, how to situationally.

[00:13:09] Vince Menzione: You know, Jay and I were talking about this 28 moments and he talked about a deal that started out as an AWS deal, but it wound up a Microsoft deal because NTT and Software one were involved in the in the deal and influencing the customer’s decision process. Right working with Microsoft. And so we just need to be smarter, I think.

[00:13:28] Vince Menzione: I think today it’s a very different model than it was 20 years ago when you and I got started in this business. Uh, yeah. And people just really need to go think about this more strategically in how they build this.

[00:13:39] Cyril Belikoff: It’s great. I totally agree. Um, like I said, getting your feet wet, understanding the co-sell to your point and, and, and how Microsoft sells.

[00:13:48] Cyril Belikoff: Um, and then understand what customers are trying to, you know, get, get, get out of it with their, their Azure commitments and how they can retire their Azure commitments through purchases on marketplace, which in sense them, um, to also work on the marketplace. So you, I think partners will find Microsoft sellers.

[00:14:04] Cyril Belikoff: Own compensation, um, incentive to work. We’ll find that customers are incentive to transact on the marketplace. And so just enter that, you know, triangle and, and get engaged and, uh, and learn and then give us feedback. Like, like I’ve mentioned many times with you, we, uh, we take feedback every month from customers and partners in, in forums like this, um, in other forums, and then we evolve and, you know, build out, uh, stronger experiences.

[00:14:31] Vince Menzione: Yeah. Cyril, I want to thank you again. So great to have you join us today and, uh, so excited to continue our, our mutual relationship and our beneficial relationship in 2026. So thank you again for everything you do and supporting us.

[00:14:45] Cyril Belikoff: Yeah, thank you. Thank you. Happy New Year to yourself and uh, and your community and, uh, thanks so much again.

[00:14:50] Cyril Belikoff: Appreciate it.

[00:14:50] Vince Menzione: Thank you, Cyril. The Ultimate Partner Winter Retreat is gonna be here in the Boca Studio. This is the third year that we’re gonna be here in Boca. This is always a favorite of our community members, our executive members, our sponsors and speakers. We’ll all be here in the studio, which is a really intimate setting.

[00:15:12] Vince Menzione: We can see upwards of 40, 50 people. Uh, we’ll be hosting an incredible dinner at the Boca Resort overlooking the golf course. That’s an incredible property and, uh, we’d love to have you join us. Thank you for being part of the ultimate Partner community, and I hope to see you this year at one of our events.

[00:15:30] Vince Menzione: Thank you.