Correction: the AGPL only means that you have to provide the open source code to your customers (folks who interact with the service), not to everyone (unless of course the service is open to everyone). Of course those customers could throw the code up on GitHub but in practice they probably won't.

Depending on pricepoint, the author of the original project could just become a customer of the spin-off project, and then publish the source for all.

I think a better option would be "Source Available" rather than AGPL. AGPL isn't tested in courts, but the _last_ thing a company would want is all of their source being forced open because they used demo'd some tool internally. A "source available" option allows a company to review your code or even solve their own problems, but without risk of being sued by a third party.

That's the point. Companies will choose the commercial license, then, out of fear of getting sued. If they want to review the code and demo it, they can look at the git repository or use a hosted demo version by the author. In this case, there are no fewer capabilities than with closed-source software.

AIUI the sharing provisions aren’t triggered by internal company use.