The right type of revenue for a software as a service (SaaS) business is recurring monthly product revenue, which is distinct from one-time deals, charity donations, or consulting payments. This type of revenue is essential for scaling a SaaS business and growing customer base beyond initial friends and family support. The key characteristics of the right type of revenue include being paid at full price, not for custom white-labeled versions, and not just for the consultant's time. It also involves selling products without promised features or discounts to attract specific customers. Without this type of revenue, a business is considered to be growing in the wrong direction, as it's essentially operating as a services business or charity rather than a SaaS business.