You sell additional premium extension to provide needed left out of the open-source offering.
You sell cloud hosting and on prem hosting.
There is nothing at all wrong with that. That you have built a business where you make a living from software you wrote is awesome. I wish I could.
It's right there in bold: the customer is provided with the source code of the extension when they purchase it. So long as the user is free to study, modify, and distribute this source code, then it's FOSS.
...which are open source.
I think the irritation is that the author made it sound like he is giving everything for free and gets donations to survive.
What sentence or word choice made you think she lives off donations?
This is not necessarily true. If you are the sole copyright owner, you can have your main product be AGPL and sell proprietary extensions; there's no reason why you need to enforce your copyright against yourself. Alternatively, your combined product could be under a proprietary license that is not the AGPL.