I think the biggest issue was that bandwidth wasn't ready for them, and their hype came early because it was one of the first instances of people profiting from, well, the equivalent of NFTs with the real estate land rush. By the time bandwidth caught up, that was old hat and they had a rep for largely being a place for "alternative communities" to meet up.

I was a super early adopter of things like virtual communities and MMOs, myself (and a huge Neal Stephenson fan to boot, so immediately recognized that they were using the Metaverse as their inspiration) and Second Life held very little attraction to me because of the performance. I tried it a few times, but there wasn't much immersion happening at the standard 1.5Mbps DSL speed, never mind modem.

If they'd come out at a point where the asset streaming worked smoothly for most customers, and the hype came after that--and especially if they'd come out after things like Dreams or even Little Big Planet or Mario Maker had prepped people for the idea of crowdsourced assets--I think they'd have absolutely smashed the market.