Have you heard of companies like Atlassian and Gitlab?

Jetbrains, Rational, Perforce, MySQL, GitHub, Trello, StackOverflow, Joyent, Powershell, etc as well.

The tricky part is that to monetize, you either need to master enterprise sales (which means that the product will take on some PHB-pleasing features that developers despise so they can get through procurement departments), or you need to be acquired by a big company looking to round out their developer tools offerings.

Those companies are running platforms. Not really a fair comparison.

Besides, I'm not literally saying there is no money in development tools. I'm saying that it's a difficult market.

almost everything is a difficult market these days. at least with developers, you know where they hang out. try marketing a SaaS to farmers or construction companies online.

Is GitLab well funded?

There's money in saving other people money. And in this industry, time is very, very valuable; thus there is money in saving other people time.

If you write development tools that save other people time, there is plenty of money in that.

Visual Studio Professional 2017 is $499.

Embarcadero would disagree with you.