The payload from New Zealand's first space rocket is floating somewhere off the Coromandel coast following this afternoon's successful launch.

Rocket Lab's 6-metre-long, 60kg rocket Atea-1 was launched about 2.30pm from Great Mercury Island , watched by about 50 people.

It burned for 20 seconds or so, reaching its target speed of up to Mach 5, or 5000km/h, reaching at least 100km altitude and spending between 10 and 20 minutes in the sky before splashing down.

It is the first time a privately owned rocket has been launched in the southern hemisphere.

Atea is the Maori word for space as the team wanted an indigenous name for the rocket. Today's rocket was named Manu Karere by the local Thames iwi, which means Bird Messenger.

The target area for the launch was about 50km northeast of the island. The team hope to pick the rocket's payload up within the next two days and physically recover its data.

Rocket Lab was now waiting for the payload's GPS signal to be picked up, company director Mark Rocket told NZPA.

That could depend on the waves or how buoyant the payload finally was when it splashed down, he said.

The team would not know how high the rocket reached, but with a new nose cone Mr Rocket speculated it could have reached as high as 150km.

That height was suborbital, but it was still considered to be space as there was no atmosphere. The International Space Station was about 300km above Earth, Mr Rocket said.

Mr Rocket, who changed his name from Mark Stevens about seven years ago, said the crew was "very, very pleased" with the launch, which was originally scheduled for about 7am today.

However, an aerocoupler, which connects the fuel line to the rocket, froze, effectively sticking the rocket to its launch pad.

A helicopter was dispatched from the launch site to Whitianga to pick up another hydraulic coupling - worth about $6 - from an engineering supplier.

"We nearly scrubbed the launch three times," Mr Rocket said.

The fuel had to be dumped and the rocket refilled.

"Peter Beck (Rocket Lab's chief executive and technical director) is a brilliant scientist and he managed to think quickly on his feet."

Mr Rocket said the feeling after the launch was "profound" and one of "pure elation, incredible".

"A lot of people were crying. It was really dramatic. The power of the rocket is just incredible."

Mr Rocket said the cost of the project so far was commercially sensitive.

Rocket Labs, which was set up three years ago, did not have any government investment. While it did not have the budget of Nasa "needless to say it's a considerable investment", he said.

"The last six months have been a terrific amount of work. The tech team has put in a massive effort.

"It's not trivial sending something into space. This is a huge technological leap for New Zealand."

The next step after recovering the payload would be planning for the next launch, he said.

Rocket Lab was a space launch business and there was massive interest in the company's products from around the world, he said.