diff --git a/cli/package.json b/cli/package.json
index fc27ab9a..beec90b4 100644
--- a/cli/package.json
+++ b/cli/package.json
@@ -1,6 +1,6 @@
 {
   "name": "@openrouter/spawn",
-  "version": "0.6.8",
+  "version": "0.6.9",
   "type": "module",
   "bin": {
     "spawn": "cli.js"
diff --git a/cli/src/digitalocean/digitalocean.ts b/cli/src/digitalocean/digitalocean.ts
index 4712ecda..c924b41c 100644
--- a/cli/src/digitalocean/digitalocean.ts
+++ b/cli/src/digitalocean/digitalocean.ts
@@ -760,29 +760,54 @@ export async function waitForCloudInit(
     await sleep(5000);
   }
 
-  logStep("Waiting for cloud-init to complete...");
-  for (let attempt = 1; attempt <= 60; attempt++) {
+  // Stream cloud-init output so the user sees progress in real time
+  logStep("Streaming cloud-init output (timeout: 5min)...");
+  const remoteScript = [
+    'tail -f /var/log/cloud-init-output.log 2>/dev/null &',
+    'TAIL_PID=$!',
+    'for i in $(seq 1 150); do',
+    '  if [ -f /root/.cloud-init-complete ]; then',
+    '    kill $TAIL_PID 2>/dev/null; wait $TAIL_PID 2>/dev/null',
+    '    echo ""; echo "--- cloud-init complete ---"; exit 0',
+    '  fi',
+    '  sleep 2',
+    'done',
+    'kill $TAIL_PID 2>/dev/null; wait $TAIL_PID 2>/dev/null',
+    'echo ""; echo "--- cloud-init timed out ---"; exit 1',
+  ].join("; ");
+
+  try {
+    const proc = Bun.spawn(
+      ["ssh", ...SSH_OPTS, `root@${serverIp}`, remoteScript],
+      { stdio: ["ignore", "inherit", "inherit"] },
+    );
+    const exitCode = await proc.exited;
+    if (exitCode === 0) {
+      logInfo("Cloud-init complete");
+      return;
+    }
+    logWarn("Cloud-init did not complete within 5 minutes");
+  } catch {
+    logWarn("Could not stream cloud-init log, falling back to polling...");
+  }
+
+  // Brief fallback poll if streaming failed (e.g. log file not yet created)
+  for (let attempt = 1; attempt <= 6; attempt++) {
     try {
       const proc = Bun.spawn(
         ["ssh", ...SSH_OPTS, `root@${serverIp}`, "test -f /root/.cloud-init-complete && echo done"],
         { stdio: ["ignore", "pipe", "pipe"] },
       );
       const stdout = await new Response(proc.stdout).text();
-      const exitCode = await proc.exited;
-      if (exitCode === 0 && stdout.includes("done")) {
+      if ((await proc.exited) === 0 && stdout.includes("done")) {
         logInfo("Cloud-init complete");
         return;
       }
-    } catch {
-      // ignore
-    }
-    if (attempt >= 60) {
-      logWarn("Cloud-init marker not found, continuing anyway...");
-      return;
-    }
-    logStep(`Cloud-init in progress (${attempt}/60)`);
+    } catch { /* ignore */ }
+    logStep(`Cloud-init in progress (${attempt}/6)`);
     await sleep(5000);
   }
+  logWarn("Cloud-init marker not found, continuing anyway...");
 }
 
 export async function runServer(