Make the strawberry reduction: Add the quartered strawberries to a blender and puree until smooth. Pour into a saucepan and simmer over medium heat, stirring frequently, until the mixture thickens and reduces to about 3/4 cup. Let it cool completely before using.

Prepare the cake batter: Preheat your oven to 350°F and line three 8-inch cake pans with parchment paper, greasing the sides. In a bowl, whisk together the strawberry reduction, sour cream, milk, eggs, and vanilla extract. Set aside 1 cup of this mixture for later.

Combine dry ingredients and butter: In a large mixing bowl, whisk flour, sugar, baking powder, baking soda, and salt. With the mixer on low speed, add butter one tablespoon at a time until the mixture looks like wet sand.

Add wet mixture to dry: Pour in the larger portion of the wet mixture and beat on medium-high speed until fluffy, about a minute. Scrape down the bowl, then slowly add the remaining reserved wet mixture and food coloring (if using). Mix until fully combined and smooth.

Bake the cakes: Divide the batter evenly into the pans and bake for 24–26 minutes, or until a toothpick inserted in the center comes out with a few moist crumbs. Let the cakes cool in the pans briefly, then transfer to wire racks to cool completely.

Prepare the frosting: Pulse the freeze-dried strawberries in a food processor until powdered. In a mixing bowl, beat cream cheese and butter together until smooth. Gradually add half of the powdered sugar and vanilla, mix, then add the remaining sugar and strawberry powder. Add a pinch of salt to balance sweetness.

Assemble the cake: Trim the domes from each cake layer. Place the first layer on a cake plate and spread 1 cup of frosting evenly over the top. Press in half the chopped strawberries. Repeat with the second layer. Top with the final layer and cover the entire cake in frosting.

Decorate the cake: Use remaining frosting to pipe a border along the top and bottom edges of the cake. Garnish with fresh strawberries and refrigerate until serving time.