This came across my twitter feed and it brought back a discussion about how to know your startup was in trouble. This is perhaps the best indicator, people start lying to themselves.

A reasonably good book on the topic is Bossidy's "Confronting Reality". In that book he has a lot of good anecdotes and techniques for testing whether or not you're lying to yourself but at the risk of spoiling it I'll share it hear, if you can't validate your business model with external realities (facts that your employees generally can't re-cast in a different light) you have a huge problem regardless of what people are telling you.

Similarly when your customers are converting or your life time customer value isn't where it needs to be for your startup's business plan to work, you need to figure that out right now.

If you see your upper management ignoring signs like this, that is a huge sign that your startup is not going to make it.