1. The UI was very sloppy. For the user, one had to learn many new concepts (what is a webkey? why do apps not work on mobile?)
2. New app developer model meant that it was impossible to create apps easily without insane complexity. If you see all the apps, they had to fork from the main code base and generally lagged behind because packaging for sandstorm required a LOT of work.
3. The web frame that they added around each app was annoying. This frame could not be disabled and thus made many use cases like having a public forum, blog impossible.
4. Their own infrastructure was not self-hosted including using github (when gitlab exists), google groups (when nodebb app exists). They continued to use irc despite having a rocket.chat app as the main showcase. They should be dogfooding.
The alternatives today are at https://github.com/Kickball/awesome-selfhosted#self-hosting-.... I recommend https://cloudron.io. They focus simply on installing things and don't invent a new developer model (it's based on docker)