Issue

A created office 365 backup set will not run due to an invalid or no office 365 subscription being applied to the backup user

Resolution

To resolve you must ensure the backup user has one of the below licenses assigned in the office 365 Administration portal:

Office 365 Business 
Office 365 Business Essentials
Office 365 Business Premium 
Office 365 Enterprise E1
Office 365 Enterprise E3 
Office 365 Enterprise E4
Office 365 Enterprise E5 
Office 365 Education