ArmaLite began as a small engineering concern founded by George Sullivan, the patent counsel for Lockheed Corporation, and funded by Fairchild Engine and Airplane Corporation. On October 1, 1954, the company was incorporated as the ArmaLite Corporation, becoming a subdivision of Fairchild. With its limited capital and tiny machine shop, ArmaLite was never intended to be an arms manufacturer. The company focused on producing small arms concepts and designs to be sold or licensed to other manufacturers. Sullivan leased a small machine shop in Hollywood, California, hired several employees, and began work on a prototype for a lightweight survival rifle for use by downed aircrew.