Combine the coconut milk and xylitol in a small sauce pot. Bring to a boil and cook 1-2 minutes until the xylitol has dissolved. (Note: you can use coconut milk to do this but use another ⅔ cup coconut milk for a total of 16 oz or 2 cups.)
Reduce heat to simmer and continue to cook uncovered, stirring occasionally, until it has reduced by about half (this will go faster if you use a pan that is larger also make a mental note of where on the pan the liquid goes so you will know when it is fully reduced). Add in the vanilla. Makes about 1 cup or 8oz. Each serving is 1 tbsp.