Microsoft is opening its Imagine Cup to early-stage startups for the first time in 2027, offering $250,000 in cash and $1 million in cloud credits to the winner. The new rules also let entrants use any AI as long as they use Azure, and they drop diversity criteria from judging.
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Illustrative image · Source: GeekWire · Microsoft's Dona Sarkar (left) looks on as members of the FROM YOUR EYES team hoist the trophy after winning the 2024 Imagine Cup at Microsoft Build in Seattle. The competition is expanding beyond students for the first time in 2027. (GeekWire Photo / Todd Bishop) · Rights unverified · Reencoded as WebP with metadata removed. Display may be resized or cropped.
Microsoft is expanding its Imagine Cup, a competition for student developers since 2003, to early-stage startups whose founders are not in school, with $250,000 in cash and $1 million in cloud credits awarded to the winner. The change, announced Monday, opens the competition to companies founded in the past two years that have not raised a Series C round, whether or not their founders are students.
Startups will compete in six industry categories, including cybersecurity, developer tools and healthcare. Students will get a seventh category of their own, with a $25,000 top prize, or they can choose to compete for the main prize in the industry categories.
The AI usage rules have changed year by year. In 2024, entrants had to build their products with Microsoft and/or OpenAI services. In 2025, they had to use at least one Microsoft AI service, and in 2026, at least two Microsoft AI services. For 2027, they can use any AI they want, as long as they use Microsoft's Azure cloud. Tom Davis, general manager of Microsoft for Startups, said the 2027 competition reflects that same approach, giving founders the flexibility to choose the right models and technologies while meeting the competition's Azure and technical requirements.
The judging criteria have shifted toward business customers. Final-round judges, whose scores determine all of the winners, will look for net revenue retention over the previous 12 months, six months of traction data, and a customer reference willing to be contacted. For startups in the industry categories, the first-round scoring criteria in 2027 will include Microsoft and Azure commercial readiness, and expected cloud and AI consumption. A live production workload on Azure is worth 6 of 100 points in the final round; in 2026, use of Microsoft technology made up 40% of the score in every round.
The new rules also drop diversity, inclusion and accessibility from the judging criteria, where they had been through 2026. Davis said Microsoft updated the judging framework to reflect the range of industries and customer challenges represented in the competition, and that inclusion and accessibility remain central to the company's mission. Applications are due Feb. 28, and winners will be selected in April and announced in May or June at a World Championship, with the date and location still to be determined, Davis said.
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