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I have an old ArcGIS 10.1 in my laptop. While I'm trying to create a geodatabase it gets created, but doesn't let me create new featureclass and/or feature dataset. I get the error:" failed to connect to database. bad login user."

Is there something I'm missing here? I'm the admin on my laptop, and SQLExpress(V.2012), which has been installed by me. Though I don't know if I'm logging in as SQLEXPRESS' admin. I don't remember the credentials, I have definitely left it as default though.

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    Please edit the question to clarify whether you are trying to create a feature class or a feature dataset in your workgroup geodatabase (there is no such thing as a "feature set"). You should also specify the release of SQL Server Express in use. – Vince Aug 19 '15 at 4:36
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    @Vince There is such a thing as a feature set but I doubt that it is being used here :-) – PolyGeo♦ Aug 19 '15 at 4:44
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I'm sure you've moved on since the question was asked but I wanted to pass along a doc on what might be happening here for users who land here.

Error: Failed to connect to database. Bad login user. Success when creating a geodatabase using ArcSDE workgroup license.

The gist of it is there was a bug at 10.1 (NIM083155) where the SDE Workgroup license string was not being entered into the registry key. When this failure occurs, the database is dropped.

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