In a medium saucepan, mix together the sugar and the water. Cook on the stove over medium heat until the bubbles start to form, around 3-4 minutes. Do not stir. Swirl the saucepan occasionally and brush down the sides of the pan to prevent crystallization.
Continue swirling until the mixture thickens and turns a deep amber colour like honey, around 8-12 minutes.
Whisk in the butter until fully combined.
Remove from heat and slowly mix in the heavy cream, whisking until fully incorporated.
Mix in the vanilla and allow to cool in the saucepan for around 10 minutes.
Pour into a mason jar and allow to cool completely. The mixture should thicken more as it cools.