Philip Rosedale

Linden Lab CEO stepping down

March 14, 2008: 6:54 PM ET

By Michal Lev-Ram

The virtual world is looking for a new real-life leader. Linden Lab chief executive Philip Rosedale, the man who created popular online community Second Life, announced Friday that he is relinquishing his CEO duties but will remain at the company as chairman.

According to San Francisco-based Linden Lab, Second Life users spend nearly 30 million hours on the site per month, interacting with each other through avatars, or three-dimensional computerized versions of themselves, and creating and selling virtual goods like real estate and clothes. Many companies have used Second Life for marketing purposes or to create online storefronts, and several countries even operate virtual embassies on the site.

But the rate of new members has slowed recently, and the company has struggled with Second Life scams like virtual bank defauls.

Linden Lab, which launched Second Life in 2003, said it is looking for a new leader with more "management and leadership expertise" who can expand the business.

"This is a normal and natural evolution rather than a crisis-driven move," current Linden Lab chairman Mitch Kapor told Fortune Friday. Kapor added that a key requirement for the company's next leader will be his or her "chemistry" with Rosedale.

In a blog post titled "Changing my Job," Rosedale said relinquishing his post would allow him to focus more on product strategy and vision.

"Second Life is my life's work, and I am not going anywhere," wrote Rosedale.

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