Combine coffee and water in a mason jar and shake well. Let sit on counter at room temperature overnight.
Line a mesh strainer with a fine cheesecloth and place over a large bowl or measuring cup. Pour coffee through the cheesecloth to collect all of the grounds. Discard grounds.
Line mesh strainer with fresh cheesecloth and strain the cold brew, for a second time, back into the Mason jar and chill.
When ready to serve, mix cold brew concentrate with equal parts water and serve over ice. Add milk or cream and a drizzle of caramel sauce if desired.