This setup assumes you use git, and creates a local folder that is ignored by git to store your tools in. Other version control software (e.g. Perforce) should also support ignore files.
Instead of using an app or terminal to access your version control, a Virtual File System(VFS) lets you browse your computer like normal. Displaying files and folders from the version control server. When you open a file, it downloads the file on the fly. So you can access large repos without having to first download everything.