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Can you start with Azure Active Directory and later implement Server Active Directory, populating the cloud onto the Server?

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Right now we are looking at setting up cloud active directory, but down the road may need to set up actual active directory servers to manage more equipment. Can you use the cloud active directory to start off a new physical active directory? The Sync tool notes that it doesn't populate new objects, it just updates existing ones. So would I have to create an active directory server now and tie it to the azure cloud to save my users having to deal with a new username/password when the active directory server might be needed in the future?

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