Interstellar Technologies, based in the country's northernmost prefecture of Hokkaido, plans to use the data from the test flight to make technical improvements. By 2020, it aims to launch a compact satellite into orbit.
Only state-sponsored projects -- involving the Japan Aerospace Exploration Agency along with Mitsubishi Heavy Industries or other players -- have hitherto succeeded in launching rockets.
Mr Horie, best known for the accounting scandal at internet company Livedoor, where he was CEO, set up Interstellar in the hope of making a breakthrough for private spaceflight. The space business is now led by CEO Takahiro Inagawa.
The ethanol-powered sounding rocket measures 9.9 meters long and 0.5 meter in diameter. Although it delivers less thrust, ethanol is cheaper and less toxic than hydrazine, a popular rocket fuel.
The company says it has managed to reduce costs to hundreds of thousands of US dollars by combining conventional technologies.
Once it is launched from an Interstellar facility in the Hokkaido town of Taiki, the rocket will fly for about four minutes, topping out at 100km. It will then parachute down into the Pacific Ocean. Measuring equipment on the rocket will be collected for analysis.
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