(FORTUNE Small Business) – On the morning of June 21, space entrepreneur Jim Benson stood on the tarmac at Mojave Airport and wept. An announcer had just interrupted the pounding rock music on the sound system to relay a message from the sky. SpaceShip One was on its way back to Earth, having carried its pilot to an altitude of 328,491 feet. For the first time ever the private sector had put a man in space.

Benson's San Diego--based company, SpaceDev, provided most of the rocket technology that had just propelled SpaceShip One into history. It's an impressive achievement, but Benson plans to be much more than just an anonymous aerospace contractor. Benson hopes that SpaceDev's products will drive the growth of an entire private space industry, encompassing everything from missile defense satellites to suborbital package delivery to tourism to asteroid mining and eventually self-sufficient human settlements in space.

That's why Benson, 59, was so eager to meet Virgin chairman Richard Branson, who was standing in a special, roped-off enclosure with Apollo astronaut Buzz Aldrin. Both men had their hands shading their eyes as they stared into the sun for the first sign of the returning spaceship. Branson had recently announced that he wanted Virgin to enter the space-tourism business, and Benson was keen to provide the technology to make it happen.

"Richard!" Benson yelled. "Hey, Richard! Over here!" Branson strolled to the rope line, looking even more than usual like the Cowardly Lion from The Wizard of Oz. Benson delivered a rapid-fire pitch. Branson nodded amiably, took Benson's card, and handed it to a young aide in a goatee and a modish black suit. The aide walked over to Benson and chatted with him for a minute or two.

"He promised to come down to San Diego and visit us!" Benson said proudly. Later, an estimated 27,000 spectators cheered as a Ford pickup truck towed the white, football-shaped spaceship along the runway. South African pilot Mike Melville rode on top like a rodeo rider on a high-tech bull. In the crowd two paunchy, middle-aged men brandished hand-lettered signs: SPACESHIP ONE, GOVERNMENT ZERO, AND IN SPACE, NO ONE CAN HEAR THE GOVERNMENT SCREAM.

At the post-flight press conference, all eyes were on the 63-year-old Melville, on Burt Rutan, the eccentric inventor who designed SpaceShip One, and on Microsoft co-founder Paul Allen, who financed the project. Benson was just another face in the crowd, despite his vital role in SpaceShip One's success.

Benson may have the last laugh, however. Over the past four years Allen has spent a rumored $20 million on the SpaceShip One project. That's not much compared with the untold billions that NASA spent developing the space shuttle (a single shuttle launch costs around $450 million). The June 21 flight lasted only a few minutes and barely cleared Earth's atmosphere, but it demonstrated the viability of private space flight and may well encourage Branson and other wealthy entrepreneurs to bankroll a commercial space-tourism industry. Yet Allen's only realistic hope of a near-term payout is the Ansari X Prize, a $10 million award for the first private team that manages to put at least one person into space twice in two weeks, using the same vehicle, before the end of 2004.

Meanwhile Benson is actually making money from such unlikely products as a laptop-guided research satellite and a rocket motor that runs on black rubber and laughing gas. And Benson's products are cheap by space standards. He developed the SpaceShip One rocket motor for about $1 million, although project delays forced him to take out a second mortgage on his house to pay the engineers' salaries.

Benson is a former computer entrepreneur who launched SpaceDev in 1997 with profits from the sale of two small software companies. Since then he has invested more than $5 million of his personal fortune in SpaceDev, which announced its first operating profit in the first quarter of 2004. (On the news of SpaceShip One's launch, the company's stock rose from $1.57 on June 14 to a high of $2.01 on June 18, before settling back at $1.80 on June 28.) SpaceDev's first-quarter revenue was just over $1 million, up 90% from the previous quarter. The company has about $50 million in signed federal and private-sector contracts, including one for $43 million with the Missile Defense Agency to build an experimental network of microsatellites to detect and track enemy missiles.

Benson likes to note that even though commercial space tourism is still years away, a Virginia-based company called Space Adventures has already collected some $2 million in deposits (at $102,000 per suborbital flight) from aspiring amateur astronauts. He even forecasts a market in ballistic mail delivery. Take the example of a Silicon Valley chip manufacturer that wants to send a laptop computer to a factory in Taiwan. The computer is loaded with secret design data that the manufacturer won't trust to the Internet. Using SpaceDev's rockets and a reusable launch vehicle, Benson claims that a package could travel from San Jose to Taipei in 20 minutes at a cost roughly comparable to a first-class air ticket. While it's not clear how many clients would find this value proposition attractive, you have to give Benson credit for imagination.

The American space community had turned out in force for SpaceDev's reception in Mojave on the night before the SpaceShip One launch. I spotted Buzz Aldrin chatting near the buffet with Burt Rutan's brother Dick, a bearded former fighter pilot who flew Rutan's Voyager airplane around the world without stopping or refueling back in 1986. Most of SpaceDev's 30-odd employees were there, proudly sporting their new yellow company polo shirts. The members of a German TV crew stared glumly into their drinks. Numerous starry-eyed space groupies milled about the room. The clean-cut young president of the National Space Society approached Benson and grabbed his hand. "Jim, man, you're doing it, you're really doing it!" he said, pumping vigorously. Benson, a pleasant but slightly introverted man, merely smiled and promised to drop by an all-night party that the NSS was throwing in the desert. (It was originally billed as a Space Rave, but the organizers hastily rebranded it as a Space Tailgate after conservative rocket scientists grumbled that Ecstasy-addled revelers were the wrong stuff for the occasion.)

As a small boy growing up in Kansas City in the 1950s, Benson devoured I, Robot, Isaac Asimov's seminal collection of stories about a distant future where space-traveling humans coexist and ultimately compete with humanoid robots. Benson joined the Science Fiction Book of the Month Club when he was 10 years old and carries a copy of the membership card in his wallet. (The framed original hangs in his office at SpaceDev headquarters outside San Diego.) It promises to hold his reservation for the first tourist flight to the moon. "Fifty years later I'm still waiting," he told a reporter, brandishing the card. "Now I'm tired of waiting. I want to do it myself!" The moon ticket is part of Benson's regular schtick: He showed it to me when we first met, and I had seen him whip it out for several other audiences already. His other favorite party trick, when asked what sort of fuel he uses for his hybrid rocket motors, is to pull out a coaster-sized disk of black rubber stamped "Genuine Hybrid Rocket Fuel" and toss it at you like a Frisbee. At the reception he flung a disk at the bespectacled editor of a space website, who blushed and looked thrilled.

The tech revolution of the 1980s and 1990s was created by restless visionaries looking for the Next Big Thing. Now that information technology is becoming a commodity service here on Earth, space is starting to look like the new frontier for private enterprise, particularly if you don't mind burning industrial quantities of cash to get there. Although Benson isn't the only former techie in the space business (see box), he inaugurated the trend. And while he's small fry compared with space-happy billionaires such as Allen and Jeff Bezos, Benson has been in the business longer and may well have the most realistic hope of success.

To get an idea of just how far Benson's vision might take him, I followed him to a northern Ontario mining town called Sudbury. Unlike the private space business, Sudbury's economy is old and almost entirely subterranean. In 1901, Thomas Edison visited the area in search of nickel for his new storage battery. Edison struck out as a miner, but later prospectors were more successful. There are 13 active nickel, copper, and platinum mines in greater Sudbury today, and the local mining industry generates more than $2.5 billion in revenues each year.

Yet Sudbury is no stranger to visits from outer space. Nearly two billion years ago a giant meteorite landed here, digging a crater some 37 miles wide. The meteorite itself probably vaporized when it hit the ground, but the tremendous impact cracked the Earth's crust and forced mineral-laden magma from the mantle up toward the surface, just as the yolk wells up when you crack a soft-boiled egg with your spoon. And that, geologists say, is why Sudbury is one of the richest mining centers on the planet.

In a roundabout way, the ancient meteorite also explained Benson's presence in Sudbury. The local mines will all be tapped out one day, but the solar system is full of asteroids and comets that could be exploited for their natural resources. Benson studied geology in college, and SpaceDev's first project was a robotic prospecting vehicle designed to collect samples from near-Earth asteroids at a fraction of NASA's cost. NASA soon canceled its asteroid exploration program, and Benson started building compact satellites and launch vehicles instead. But he remains convinced that there's big money to be made on the natural resources of space. That's why a local research institute called the Northern Center for Advanced Technology (NORCAT) invited him to address a symposium on space mining.

It was a chilly, overcast day in northern Ontario. Under a large tent pitched outside the entrance to a mine tunnel bored 600 feet into the crater wall, mining engineers sat with scientists from NASA and the Canadian Space Agency, local government officials, and a number of high-tech entrepreneurs. Considering the exotic subject matter, the presentations were surprisingly practical in tone. "Let's get up there and mine the bejesus out of those asteroids before they get us first," said John Gammon, a mineral policy advisor to the Ontario provincial government. Gammon noted that space research could have practical implications for the mining industry right there in Ontario. The U.S. space program produced the Global Positioning Satellite system, for example, which miners use to prospect new claims. And NORCAT has developed a robotic space drill that it hopes NASA will use to collect subsurface samples on future Mars missions. The drill needs no lubricant and is compact enough to load into the back of a pickup truck, making it useful for mineral prospecting in hard-to-reach areas here on Earth.

A planetary scientist named John Lewis from the University of Arizona wowed the crowd with an explanation of the basic science of mining asteroids. He made it all sound so simple. In addition to nickel, platinum, ultrapure iron, and other valuable minerals, many asteroids contain huge deposits of ice that can be broken down into oxygen and hydrogen for rocket fuel. "Near-Earth asteroids contain enough resources to support a population of ten billion people until the sun dies of old age," Lewis said.

Naturally, there's a catch. All ten billion people would have to live in space. Why? It's uneconomical to bring most of this stuff back to Earth. Given that it costs an average of $10,000 to lift a single pound of cargo into orbit, the cost of the fuel would greatly exceed the value of the freight. One possible exception: platinum. According to astrogeologist Jeffrey Kargel, a single metallic asteroid one half-mile in diameter could easily contain some 400,000 tons of platinum and related metals. Kargel calculated the Earth value of that cargo at $5 trillion. Even though introducing mass quantities of rare metals into the market would cause their price to plunge, he concluded that a single asteroid's platinum would still fetch more than $300 billion.

Platinum aside, the economics of space flight suggest that mankind will have to colonize space to take advantage of its resources. It's a classic chicken-and-egg problem: No one will move into space unless there's profit to be earned, but there can't be any profit without space settlements to consume the products of industry. It wasn't looking good for the aspiring space miners of Sudbury. Luckily that's where Benson came in.

"I like coming to Sudbury," he said. "It's good to see people extracting profit from an asteroid." In brief strokes, he outlined his vision for a private space industry. As the first computer entrepreneur to start a space company, Benson is fond of digital metaphors. He sees SpaceDev as the microcomputer to NASA's mainframe, a disruptive player that will bring market forces to space. "Space will only happen if it's profitable," Benson said. "We can only go so far on the taxpayer's back."

For now SpaceDev plans to sidestep the chicken-and-egg trap by selling cheap products with immediate applications, such as rocket motors and small research satellites. Ultimately, Benson wants to run the Standard Oil of space, mining asteroids for water to fuel the space settlements that he firmly believes will exist some day. "The wealth in space is so astounding, there should be a stampede to get it," he said. With that, he wound up his talk and sprinted for the airport. It all sounded pretty wacky, until I remembered that Benson ran a small but viable public company and that he already had a satellite in orbit. He was a busy man with places to go on Earth and in the heavens.