Although the screenshot shows an error with retracting, I was getting the same error when deploying. I figured, maybe it works if I deploy it again, but alas 🙂

The error is related to a service not being started on the SharePoint server. In order to start it, do the following:

– Go to Central Administration -> System Settings -> Manage services on server
– Locate the service “Microsoft SharePoint Foundation User Code Service”

Just click the “Start” link button to start the service.