Add white sugar and water to a large skillet. Heat over medium-high and bring the mixture to a boil on the stove-top.
Shaking the skillet frequently, continue to cook the water and sugar mixture until it turns an amber color like so.
Turn off the heat. Pour in the heavy cream and whisk right away to combine. The mixture will bubble up a lot as pictured. Be careful. It's very hot.
Add the salted butter, bourbon and vanilla extract. Whisk until the butter melts and the caramel sauce turns silky and smooth.