I'm in charge of SSRS and don't know much about Azure VM.
I haven't searched for a way to change the license model other than SQL IaaS Agent. I searched some blogs and most of them are about deploying SSRS after enabling SQL IaaS extension. You can refer to these links:
This link also provides information about the modernization of SSRS, which you can also use as a reference: https://techcommunity.microsoft.com/t5/azure-sql-blog/modernizing-ssrs-and-a-step-by-step-guide-to-bringing/ba-p/2483050.
Best regards,
Aniya