AWS Courts High-Flying Startups with Extra $100K in Cloud Credits

Facing increasing competition from cloud rivals Microsoft and Google, Amazon Web Services (AWS) is sweetening the pot for startups to build apps on its cloud.

For select startups, AWS is doubling the amount of cloud credits it's offering via its AWS Activate program, doling out $200,000 instead of the usual $100,000.

The increase was first reported by CNBC last week, citing an e-mail it obtained from AWS to venture capitalist investors. AWS subsequently confirmed the increase to the outlet.

The $200,000 credit offer, which became available this past Monday, July 1, applies only to startups that have already had a Series A funding round within the past 12 months. The $100,000 credit offer will remain in place for very early-stage startups that have raised only limited funds.

Startups enrolled in the Activate program can use these credits to offset their AWS bills. They can cover support costs, as well as the cost of running various AWS services, including compute, storage, developer tools, databases and more. Startups have a finite window in which to spend these credits, however -- one year for $100,000 and three years for $200,000.

As of this writing, AWS has not updated its AWS Activate page with information about the new $200,000 credit offer.

The move comes as AWS' once-jackrabbit pace of growth has begun to slow, while its competitors Microsoft and Google enjoy steady market share gains.

Top cloud vendors' growth rate trends, Q1 2020 to Q4 2023
[Click on image for larger view.]  Top cloud vendors' growth rate trends, Q1 2020 to Q4 2023. (Source: Canalys, February 2024 data)

In addition, AWS is also seen as the unexpected laggard -- at least among cloud's Big 3 -- in the generative AI race. Here, Microsoft is considered the early front-runner, thanks to its early and extensive investments in generative AI darling OpenAI.

AWS has been playing catch-up, however, investing billions in AI maker Anthropic, building out its AI and machine learning portfolio, and adding high-profile AI scientists to its team. Doubling the amount of Activate credits it offers has the potential to attract more startups, specifically AI startups, to AWS.

The company already has several AI-specific startup programs, including an AI accelerator and a $230 million investment fund. AWS also recently allowed Activate startups to use their credits to access the Amazon Bedrock AI model platform.

About the Author

Gladys Rama (@GladysRama3) is the editorial director of Converge360.


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