Microsoft unveils Rayfin to turn Fabric into an enterprise AI application runtime

Rayfin signals Microsoft's push to make Fabric an AI app runtime

Beyond productivity gains, the platform play focuses on unifying data, governance, and deployment for enterprise AI. For enterprises embracing AI-assisted development, writing code is no longer the hardest part. Operationalizing it is. Microsoft is targeting that challenge with Rayfin, a new open-source SDK and CLI unveiled at Build 2026. "Rayfin turns backend development into a code-first workflow. Developers and coding agents can define a full application backend in code, including databases, business logic, APIs, identity, and access policies, and deploy it to Microsoft Fabric for a fully managed, enterprise-grade backend," Shireesh Thota, CVP of databases at Microsoft, wrote in a blog post.

Microsoft Build: Microsoft IQ and Rayfin take on enterprise AI data silos

Every new AI agent your team deploys starts from scratch: no memory of how the business works, where data lives, or what rules apply. And as agentic coding tools spin up applications faster than anyone can govern them, each one risks becoming another silo outside your data layer entirely. Microsoft is addressing both problems directly at Build 2026. According to VentureBeat's VB Pulse's Q1 2026 RAG Infrastructure Market Tracker, hybrid retrieval intent among 100-plus employee organizations tripled from 10.3% in January to 33.3% in March, a signal that enterprises have moved past expanding RAG coverage and are now focused on the architecture underneath it. Shared business context is the part retrieval does not solve. On the context side, Microsoft is expanding Fabric IQ, its existing business data context layer, into a broader unified system called Microsoft IQ, adding three additional context sources covering how the organization works, what it knows and real-time global signals from the web, so any agent can tap all four as a single foundation. On the application side, Rayfin, a new open-source SDK and CLI, deploys agent-built applications directly to Fabric as a governed production backend, routing application data into the same platform rather than spinning up new silos. Amir Netz, CTO of Microsoft Fabric, reached for a film analogy to explain where the data platform fits. The green screen of cascading code in "The Matrix" wasn't atmosphere, it was the layer that built the world Agent Smith operated in. "Our job in the world of data is creating reality for agents based on data," Netz told VentureBeat. Microsoft IQ unifies four context sources into a single agent foundation Microsoft IQ brings together four context sources that until now existed separately, designed so a developer can connect a new agent to all four in a single integration step. Work IQ. Captures how the organization operates day to day, drawing on email, documents, meetings and schedules to give agents an understanding of people, teams and workflows. Foundry IQ. Manages institutional knowledge, curating and indexing knowledge bases so agents understand what it means to work within the organization, what rules apply and what procedures to follow. Fabric IQ. Models the live operational state of the business through data, defining entities, relationships and business rules grounded in real-time signals from Fabric Real-Time Intelligence. Ontologies, the layer that captures that operational context, are expected to reach GA in the coming months. Web IQ. Adds real-time global context from the web, giving agents a current picture of the world outside the organization alongside its internal data. "The agents are going to become highly informed virtual employees," Netz said. "That's where the world is heading." Rayfin routes agent-built applications into the same data foundation Building shared context solves one half of the problem. The other is what happens when agents start generating applications. Every new app needs a backend, and without a governed deployment path each one creates a new data silo outside the context layer entirely. Rayfin provides an enterprise-grade back end and deploys agent-built applications directly to Fabric, so application data lands in Microsoft OneLake by default and feeds back into the Microsoft IQ context layer rather than accumulating outside it. Microsoft positions Rayfin against Supabase and Neon, the Postgres-compatible backends that agentic coding tools default to. The differentiator is governance: Rayfin routes the entire application fleet through Fabric's unified data and compliance layer rather than creating isolated silos. Netz described the relationship as bidirectional. The agent building a Rayfin application draws from the organization's ontology. The data that application generates then enriches that ontology for the next agent. Every major data platform is chasing the same answer, but execution is unproven Microsoft is not the only platform building a shared context layer for agents. Snowflake announced its own context capabilities this week with semantic capabilities. Pinecone has its Nexus platform that expands the vector database to become a knowledge engine and Redis has developed its Iris context and memory platform. Microsoft's approach further reinforces the trend that RAG and model availability aren't the issue anymore. "Fabric IQ and Rayfin are important because the enterprise AI challenge is no longer just about the model availability," Robert Kramer, managing partner at KramerERP told VentureBeat. "The real question is whether Microsoft simplifies execution and strengthens trust or adds another layer to an already complex environment."

Microsoft launches Rayfin to let developers and agents build app backends on Fabric

Microsoft launches Rayfin to let developers and agents build app backends on Fabric Microsoft Corp. today introduced Rayfin, an open-source software development kit and command-line interface that lets developers and coding agents define an entire application backend in code and deploy it onto Microsoft Fabric. Announced at Microsoft Build 2026, Rayfin targets a gap that has widened as artificial intelligence has made it trivial to spin up an app frontend. The backend, including data, identity and access policies, still requires teams to stitch together multiple services and governance and compliance often get added too late. Many teams hit enterprise requirements they never designed for and end up re-platforming to reach production. With Rayfin, developers or the coding agents working on their behalf define data models, application programming interfaces, business logic, access policies and connections to existing data sources in one place. The definitions are strongly typed, so coding agents such as GitHub Copilot can read and modify them with the same reliability as a human. The CLI handles deployment to Fabric and stands up the databases, authentication, access policies and APIs, work that teams would otherwise wire together by hand. Once deployed, applications run as first-class artifacts inside Fabric and connect directly to OneLake, Microsoft's unified data layer. Governance, security and compliance come from Fabric itself, so developers do not configure them per app. And because the app sits inside the data platform, its data is ready for analytics and AI use the moment it is written, with no copies or pipelines in between. That data lands in OneLake and becomes available to Power BI, data science notebooks and Fabric's data agents. Microsoft is also pairing Rayfin with Replit Inc., the AI-first coding platform, so developers can build in an environment they already use while deploying into a managed Fabric tenant. "Rayfin unlocks a new development model for our users," said Amjad Masad, chief executive of Replit, in the announcement. "Agents write the code. Fabric ships it quickly and safely. Together, we're giving developers something they've never had before: a path from idea to enterprise-grade production that's measured in hours, not months." Microsoft cited multitool manufacturer Leatherman Tool Group Inc. as an early customer. Its teams build and iterate in Replit but keep operational and analytical data centralized in Fabric, said Cody Luth, an AI solutions architect at the company, who noted Rayfin gives the firm fast development alongside governed data. The release fits a wider Build 2026 theme of making Fabric the place where AI agents build and run software. Microsoft also declared general availability of Fabric IQ, which gives agents a shared layer of business context and detailed new analytics tooling on the platform.