a former RP sim owner and experienced role player, race leader, and RP business owner, here are my conclusions about why so many RP sims on second life fail
1. Owner/Admin attitudes
"My way or the highway" will drive people away. You do not have to accommodate every opinion, but you need to listen and show respect.
"The guests owe us." No. guests do not owe you anything. They are your customers and if you want them to role play and possibly donate or rent from you, then you have to give them a superb experience. Developing a resentful attitude toward non-paying customers will eventually kill your sim.
"As an owner, I am an SL aristrocrat." No, you are not. Anyone can be a sim owner, regardless of SL experience. As far as social rank, you are like a shop owner and your guests are the customers, not the other way around.
Hostile or competitive attitudes toward guests are uncalled for and will end the sim in short order. Once a sim and its owner get a reputation for nastiness, it is almost impossible to start over. If you want a fresh start after being a nasty owner or admin and losing your sim, you will have to create an alt and keep your other identity a secret.
2. Owner/Admin expectations
Do NOT expect Sim guests to pay for any part of the tier. If you cannot cover 100% of the tier yourself, plus all costs of purchasing products for the sim, then do not own one. Guests sometimes donate, but consider that icing on the cake, not the meal.
It will take a year or more to get your sim off the ground and self sustaining in terms of participation. Impatience will kill the sim early.
You must be on your own sim as a player 2-3 hours a day when starting out. You must always be RP ready. Owners and admins who park themselves OOC or AFK display a lackadaisical attitude about their own sim and guests will pick up on that and fall away. Parking OOC or IC with a tiny group of besties and refusing to RP with others will drive the sim into the ground.
Rent should never be more than 2-2.5 times the prim limit offered the renter. Sims that charge a high rent for low prims will not attract renters.
Never assume an officer or business owner has fully read or comprehended online info or a notecard about his or her job. You must explain it in person.
If guests, officers or business owners are let go after only one mistake (happened to me), the sim is headed down a slope to shut down.
Having a one-program fits all approach to RP, such as requiring everyone to take all the same classes, regardless of prior knowledge or experience will drive people away.
Hire admins or officers only based on verifiable experience. A single draconian officer can destroy a sim's popularity.
Be wary of admins forming coalitions to overthrow the owners. This happened on one sim. The owner was persuaded to sell the sim after a coalition of admins ganged up on him and ran popularity into the ground in order to force a coup. of course their arrogance made them think the sim would bounce back under their ownership, but it died in short order. Never hesitate to oust or ban someone who refuses to play nice.
3. RP structure
lots of required classes kill morale
required mentoring is similarly a morale killer. People want to play, not endlessly prepare to play.
Too much structure makes people feel gagged and bound.
Too little structure makes people feel lost.
I recommend a lore that is sufficiently general to allow for guest creativity within reasonable parameters.
A few characters will get into using fictional race languages, but not a lot. Do not expect huge interest in learning to speak elvish, dwarvish or other race languages. Allow characters within a race to have their own language or dialect.
Allow diversity in beliefs. a state-endorsed religious cult tends to drive away all but the power-hungry.
Keep the allowed race list at 15 or less. A circus of one-of-a-kind races is silly and annoying to those who want to be part of a one-race community.
Rules should be simple and ethical. Show everyone respect and good manners OOC. Excessive IC nastiness should be good cause for a character withdrawing ICly from an interchange and avoiding that character. IC nastiness about beliefs or LGBTQ issues can go bad and OOC very fast. Sometimes people play a hateful character because that is how they really feel in RL and use the character as a vent for RL hatred. Be very wary of IC nastiness that becomes a sort of persecution. This also applies to nastiness toward IC conservative religious beliefs. a Character who is Christian may fall under the same IC fire from someone who dislikes that faith, the same as a gay character may fall under fire IC from someone who RL dislikes LGBT. If you see a pattern of persecution or hostility based on any aspect of identity, then investigate it.
Make character IC actions have IC consequences. If I am mean or haughty toward everyone, then no one will like me or talk to me even IC. natural consequence of my IC attitude.
Experiencing leveling often rewards people with increased battle ability for RP that has nothing to do with battle. Any sense that people get of unfairness will drive them away.
Factions need to represent a range of ethical perspectives. Two egotistical royal *****s fighting it out with no other factions to choose from will drive away everyone who does not wish to play blind loyalty to a ***** royal. Have at least one faction that is pacifist and neutral.
Races to have equal powers and huge discrepancies in power based on XP can cause discouragement and inactivity among guests. If I can never get caught up in battle level to those who have been on a while, then I will get discouraged and possibly leave. I recommend 5 experience levels, with 5 representing the highest level of mastery and no further progress beyond it. That way a newcomer can eventually rise to equal footing with old-timers.
4. Building Mistakes
Poorly or non-artistically built sims are a sore thumb in the eyes of potential RP guests. Get or hire an SL building artist to evaluate your sim and advise you
Using up most of your prim allowance for the sim will lag the sim down and prevent people from being able to rent personal prim allowances.
Excessive scripts in objects will lag the sim down horrendously. Once objects are sized and textured or colored right, remove the scripts for altering those things. If the object is not copy perm, then save the scripts in a folder so you can return them to object's contents at any time.
High Avatar complexity and scripts will lag a sim down. Make sure guests are told to remove sizing texturing and coloring scripts from clothing or objects they wear. If I carry a mage staff around in an inactive form, have that copy of the staff also be relatively script free. Only switch to my fully magic-capable staff when I am going to use the magic.
Use phantom objects when possible. Too many non-phantom objects on a sim lags it down.
Some mesh or sculpt objects that are set to non-phantom have an extended region of exclusion way beyond the visible surface of the object. If this happens, make the object phantoms and then create an invisiprim surface to stand on.