(You don't need the external display plugged in.) Wall power outlet => USB-C Power Adapter => USB-C Power Cord => Multiport Adapter => Laptop Having the adapter plugged into one port, while the power cord is plugged into another of your laptop's ports will not work. Your USB-C Power Cord must be plugged directly into your multiport adapter (which is plugged into your laptop) when doing the reboot.
Multiple Install->Reboot cycles with everything still plugged in but the Multiport Update is not being installed. For those searching I am having this issue with a new 2016 MacBook Pro running sierra v10.12.1.