Warm the milk, water, and butter until the liquid is between around 105 to 110 degrees F. This can be done on the stovetop or in the microwave for about 30 to 60 seconds.
2 tablespoons salted butter,, 1 cup warm milk, ⅓ cup warm water
In the bowl of a stand mixer fitted with a dough hook attachment, combine the flour, sugar, yeast, and salt. Turn the mixer on to low speed and add the warm milk mixture while mixing. Increase the speed to medium and continue to knead the dough for 5 to 7 minutes until nice and smooth. If the dough is sticking to the bowl a lot, you may need to add a little extra flour, a couple tablespoons at a time. The dough should be soft and only slightly sticky but manageable once you are done kneading.
3 ¼ cups all-purpose flour, ¼ cup granulated sugar, 2 ¼ teaspoons instant yeast, 2 teaspoons salt
Transfer the dough to a lightly greased bowl and cover with plastic wrap or a damp cloth. Let rise for 1 to 2 hours in a warm spot until doubled in size.
Prepare the bundt pan by using a pastry brush to spread 2-3 Tablespoons of softened butter evenly into the crevices and curves of a standard 12-cup bundt pan. Set aside.
2 tablespoons salted butter,
Lightly punch down the down and turn it out onto a lightly greased surface. Pat the dough into a thick, roughly 8 to 9-inch square. Use a bench scraper or pizza cutter to cut the dough into 64 small pieces by cutting 8 vertical lines, then 8 horizontal lines. It's okay if they aren't perfectly uniform, but they should be roughly the same size.
Roll each chunk of dough into a ball. Melt remaining 1/2 cup butter in a medium bowl or shallow dish. Combine the cinnamon and sugar in another bowl or shallow dish.
1 ¼ cups packed light brown sugar, ½ cup salted butter,, 2 ½ teaspoons ground cinnamon
Dip each ball of dough into the melted butter, then roll in the cinnamon sugar mixture to coat. Transfer the sugared dough balls to the prepared bundt pan, off-setting them so they aren't stacked directly on top of each other.
Cover loosely with plastic wrap or a damp cloth and let rise until puffy and almost doubled in size again, another 1 to 2 hours.
Preheat oven to 350°F. Bake uncovered for 30 to 35 minutes until golden-brown on top and cooked through. It can be helpful to check the temperature of the monkey bread by inserting an instant read digital thermometer into it and looking for a temperature of 190 to 200 degrees F.
Once removed from the oven, don't let the monkey bread cool for more than 5 minutes before placing your serving plate on top of the bundt pan and inverting the pan to turn the monkey bread out before the sugar starts to harden and stick to the pan.
Whisk the powdered sugar, milk, and vanilla extract together in a small bowl until smooth. Drizzle over the warm monkey bread and enjoy!
1 cup powdered sugar, 2 tablespoons milk, ¼ teaspoon vanilla extract