we have this exact method in our packs me and my friend, but it took almost 20 minutes just to boil a small cup of water on it. every time we put the stainless steel cup on the fire it would almost always go out we had to end up holding it at the top of the flame where its the hottest in order to get a small boil going. wonder where we went wrong with it. not enough ventilation maybe? we was using 90% alchohol aswell
The fire's gonna go out for one (or two or three) of three reasons.
1. Not enough air supply. Fires aren't the smartest things around, and sometimes once you close off that big open hole in the middle with your pot, your fire is going to continue to burn up and out of every hole until it suffocates itself! Ideally some of those crimped channels will invert from air pressure and start letting air in, but it may not happen, especially if you fill up your can with a fair amount of alcohol (will require a greater difference in pressure to push the air through and under the fuel)
The simplest solution is like Lily said, poke 4-5 1/8" holes around the top of the side of the can, underneath the rim. Air will be able to flow in through those and your flames can fill all the channels they feel like!
2. Not enough temperature. Fires are delicate things, and when you light your alcohol fire it's got so much surface area to burn! It'll stay lit easily, but as soon as you cover the top all of a sudden it's only burning out of the channels, and if your alcohol is not hot enough it won't have enough energy in the system to keep it going. It'll putter out pretty quick.
The solution here is to let your stove burn without the pot on it until you can see the alcohol boiling. As soon as you see some bubbles in the bottom of your can you should be good to put your pot on and the fire will continue to burn since it won't take as much energy to ignite the already hot alcohol. This shouldn't take more than 2-3 minutes of open burning.
3. Too much wind. Again, fires this small are super easy to blow out. You'll want a wind screen around your stove. I just use a few feet of tinfoil folded over for some integrity, and wrap that sucker in a circle around my stove! The closer you get to the size of your pot the better your heat efficiency will be, but be sure not to suffocate your fire with a lack of air!