Per my initial community posting, it seems that in environments where the firewall blocks pip the YXI installation process takes longer than it needs. My experience was 9:15 minutes for a 'simple' custom tool (one dependency wheel included in the YXI).
Given the helpful explanation of the YXI installation process, it seems the --upgrade pip and setuptools is causing the delay. Disconnecting from the internet entirely causes the custom YXI to install in 1:29 minutes.
My 'Idea' is to provide a configuration option to install the YXI files 'offline'. That is, to skip the pip install --upgrade steps, and perhaps specify the --find-links and --no-index options with the pip install -r requirements.txt command. The --no-index option would assume that the developer has included the dependency wheel files in the YXI package. If possible, a second config option to add the path to the dependencies for the --find-links option would help companies that have a central location for storing their dependencies.