Bake batter in a 4-inch pan at 350°F for 18–22 minutes. Cool fully on a rack.
Beat butter, add powdered sugar, vanilla, and milk. Aim for soft, pipeable buttercream.
Divide frosting into three bowls. Tint each one a step darker with gel color.
Crumb-coat lightly, chill 10 minutes. Apply thin strips of each blue around the cake.
Smooth sides with a small offset spatula for a subtle ombré with naked edges.
Shape a small fondant sailboat: hull, mast, two sails. Let dry 10 minutes, then top cake.
Chill 15 minutes before photos; serve at room temp.