Using several bowls, separate the fruity pebble cereal by color
Remove biscuits from can (do not flatten) and use a 1-inch circle biscuit cutter to cut the holes out of the center of each biscuit.
Air fry the donuts at 350 degrees for about 5 minutes
Using a medium mixing bowl, combine the powder sugar, milk and vanilla and mix with a whisk until smooth and combined
Dip the donut into the icing to coat the top
Lightly shake the donut to get rid of excess frosting
Place the dipped donut onto the cookie sheet
Sprinkle shredded coconut onto the bottom half of the donut
Starting with your red fruity pebble, place a layer of the red on the top of the donut
Repeat steps with the orange, yellow, green blue and purple until you have a complete rainbow
Place a few gold sequin sprinkles onto the space where the rainbow meets the shredded coconut to create the 'pot of gold
Let donut icing harden for about 5 minutes before enjoying!