diff --git a/src/components/SetupBanner.tsx b/src/components/SetupBanner.tsx
index 7185891..445cc2e 100644
--- a/src/components/SetupBanner.tsx
+++ b/src/components/SetupBanner.tsx
@@ -21,6 +21,12 @@ import {
 import { Button } from "@/components/ui/button";
 import { cn } from "@/lib/utils";
 import { NodeSystemInfo } from "@/ipc/ipc_types";
+
+type NodeInstallStep =
+  | "install"
+  | "waiting-for-continue"
+  | "continue-processing";
+
 export function SetupBanner() {
   const navigate = useNavigate();
   const { isAnyProviderSetup, loading } = useSettings();
@@ -28,7 +34,8 @@ export function SetupBanner() {
     null
   );
   const [nodeCheckError, setNodeCheckError] = useState<boolean>(false);
-  const [nodeInstallLoading, setNodeInstallLoading] = useState<boolean>(false);
+  const [nodeInstallStep, setNodeInstallStep] =
+    useState<NodeInstallStep>("install");
   const checkNode = useCallback(async () => {
     try {
       setNodeCheckError(false);
@@ -52,14 +59,16 @@ export function SetupBanner() {
     });
   };
 
-  const handleNodeInstallClick = async () => {
-    setNodeInstallLoading(true);
+  const handleNodeInstallClick = useCallback(async () => {
+    setNodeInstallStep("waiting-for-continue");
     IpcClient.getInstance().openExternalUrl(nodeSystemInfo!.nodeDownloadUrl);
-  };
+  }, [nodeSystemInfo, setNodeInstallStep]);
 
-  const finishNodeInstallAndRestart = () => {
-    IpcClient.getInstance().reloadDyad();
-  };
+  const finishNodeInstall = useCallback(async () => {
+    setNodeInstallStep("continue-processing");
+    await IpcClient.getInstance().reloadEnvPath();
+    await checkNode();
+  }, [checkNode, setNodeInstallStep]);
 
   const isNodeSetupComplete = Boolean(
     nodeSystemInfo?.nodeVersion && nodeSystemInfo?.pnpmVersion
@@ -123,7 +132,7 @@ export function SetupBanner() {
                 <div className="flex items-center gap-3">
                   {getStatusIcon(isNodeSetupComplete, nodeCheckError)}
                   <span className="font-medium text-sm">
-                    1. Install Node.js
+                    1. Install Node.js (App Runtime)
                   </span>
                 </div>
               </div>
@@ -146,17 +155,37 @@ export function SetupBanner() {
               ) : (
                 <div className="text-sm">
                   <p>Node.js is required to run apps locally.</p>
-                  <p className="mb-3">
-                    After you have installed node.js, click "Finish setup" to
-                    restart Dyad.
-                  </p>
-                  {nodeInstallLoading ? (
-                    <Button onClick={finishNodeInstallAndRestart}>
-                      Finish setup and restart Dyad
+                  {nodeInstallStep === "waiting-for-continue" && (
+                    <p className="mt-1">
+                      After you have installed Node.js, click "Continue". If the
+                      installer didn't work, try{" "}
+                      <a
+                        className="text-blue-500 dark:text-blue-400 hover:underline"
+                        onClick={() => {
+                          IpcClient.getInstance().openExternalUrl(
+                            "https://nodejs.org/en/download"
+                          );
+                        }}
+                      >
+                        more download options
+                      </a>
+                      .
+                    </p>
+                  )}
+                  {nodeInstallStep === "install" ? (
+                    <Button className="mt-3" onClick={handleNodeInstallClick}>
+                      Install Node.js Runtime
                     </Button>
                   ) : (
-                    <Button onClick={handleNodeInstallClick}>
-                      Install Node.js Runtime
+                    <Button className="mt-3" onClick={finishNodeInstall}>
+                      {nodeInstallStep === "continue-processing" ? (
+                        <div className="flex items-center gap-2">
+                          <Loader2 className="h-4 w-4 animate-spin" />
+                          Checking Node.js setup...
+                        </div>
+                      ) : (
+                        "Continue | I installed Node.js"
+                      )}
                     </Button>
                   )}
                 </div>
diff --git a/src/ipc/handlers/node_handlers.ts b/src/ipc/handlers/node_handlers.ts
index 0732e00..d72d24c 100644
--- a/src/ipc/handlers/node_handlers.ts
+++ b/src/ipc/handlers/node_handlers.ts
@@ -1,7 +1,8 @@
 import { ipcMain, app } from "electron";
-import { spawn } from "child_process";
+import { exec, execSync, spawn } from "child_process";
 import { platform, arch } from "os";
 import { NodeSystemInfo } from "../ipc_types";
+import fixPath from "fix-path";
 
 function checkCommandExists(command: string): Promise<string | null> {
   return new Promise((resolve) => {
@@ -68,8 +69,16 @@ export function registerNodeHandlers() {
     return { nodeVersion, pnpmVersion, nodeDownloadUrl };
   });
 
-  ipcMain.handle("reload-dyad", async (): Promise<void> => {
-    app.relaunch();
-    app.exit(0);
+  ipcMain.handle("reload-env-path", async (): Promise<void> => {
+    console.debug("Reloading env path, previously:", process.env.PATH);
+    if (platform() === "win32") {
+      const newPath = execSync("cmd /c echo %PATH%", {
+        encoding: "utf8",
+      }).trim();
+      process.env.PATH = newPath;
+    } else {
+      fixPath();
+    }
+    console.debug("Reloaded env path, now:", process.env.PATH);
   });
 }
diff --git a/src/ipc/ipc_client.ts b/src/ipc/ipc_client.ts
index b163626..f5ffb13 100644
--- a/src/ipc/ipc_client.ts
+++ b/src/ipc/ipc_client.ts
@@ -131,8 +131,8 @@ export class IpcClient {
     return IpcClient.instance;
   }
 
-  public async reloadDyad(): Promise<void> {
-    await this.ipcRenderer.invoke("reload-dyad");
+  public async reloadEnvPath(): Promise<void> {
+    await this.ipcRenderer.invoke("reload-env-path");
   }
 
   // Create a new app with an initial chat
diff --git a/src/preload.ts b/src/preload.ts
index 249a37c..3fca189 100644
--- a/src/preload.ts
+++ b/src/preload.ts
@@ -37,7 +37,7 @@ const validInvokeChannels = [
   "github:create-repo",
   "github:push",
   "get-app-version",
-  "reload-dyad",
+  "reload-env-path",
 ] as const;
 
 // Add valid receive channels