> People build tools that they want to use, then share it with others because it's free to
This maybe sounds true on the surface, but isn't really? Prior to VSCode, Visual Studio was the most-used editor by professional developers for a very long time, with Sublime Text and Jetbrains' IDEs being close behind, and the paid options are still among the most popular. While VSCode is wildly successful, and has completely unprecedented adoption rates, it was not borne out of people "building tools because they want to, then sharing it because it's free", but is rather the result of Microsoft's calculated gamble that open-source would give them more ecosystem capture and useful data through telemetry in the long run.
> Selling software to software developers is always going to have a pretty low ceiling, because you're always going to be competing with "I could build this myself"
This shouldn't really be true if software developers would think rationally about tools for three seconds. I believe the US median compensation for developers is approaching $200k? Any tool that saves a single hour of productivity is likely paying for itself, maybe two or three for the more expensive ones. Something that saves 40 hours of productivity is basically worth its weight in gold. You might be able to say "I can build this myself", but can you build it yourself in 1 hour? 40 hours? For most software, it would still take even longer than that. If you are a paid professional, and value your own time anywhere near what your employer does (I personally value my time more than any employer ever did), you should be extremely grateful for any opportunity to spend trivial sums of money in a way that allows you to reclaim hours to use in other ways.