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"People" will show only those users who have been assigned "Exchange Online" license. It is possible to add Users to your Office 365 without giving them any of the Office 365 subscription, except "Mobile Device Management for Office 365" which is mandatory. And any user you add through Office 365 also gets added into Azure AD.


I am going to go ahead an answer this to save some poor soul in the future. The problem was with the App Manifest file. I had the Permissions => Scope set to Site Collection. This needs to be changed to 'Web'.


As per the Blog.technet here the some of hardware specification for dev/test lab. Active Directory in a Windows Azure VM Size: Small (1 core, 1.75GB Memory) SQL Server 2012 in a Windows Azure VM Size: Medium (2 cores, 3.5GB Memory) SharePoint Server 2013 in a Windows Azure VM Size: Large (4 cores, 7GB Memory) Read more here: Step-by-Step: Build a ...

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