You should have it set to the coldest setting. With a temperature controller you are over riding the built in one. So you need to put it to a setting where technically it's always "on". That way when the temp controller actually turns it on it just starts. Otherwise the temp controller will turn it on and give it current, but the internal controller has it turned off.
How much free space is in there? Extra mass helps to regulate the temperature. Consider adding buckets of water or if you have an empty keg (shame on you!!) fill it with water and add it in. Once the compressor turns off the lines are still cool. They will still help to chill it for a small time after. A fan helps out too. makes sure the air is circulating.