After having issues with Apache when upgrading to 10.7.3 Server I thought hopefully I’d have no more problems. A few days later I tried VPN-ing using L2TP. After the connection timing out and me getting errors I checked out the system.log in Server.app and I saw the following:

pppd: DSAuth plugin: Failed to retrieve MPPE encryption keys from the password server

A quick bit of searching pointed me towards an article on Configuring and enabling PPTP. Even though I wasn’t using PPTP to VPN into my server, I thought I’d give it a shot. After entering the terminal command and restarting the VPN service, I can now VPN in with no problems!