Update: Arrington is “not employed by Aol” according to this report quoting a Huffington Post spokesperson.

Update 2: Peter Kafka at AllThingsD is reporting that Arrington is indeed an AOL employee, though he no longer works for AOL’s Huffington Post Media Group. He writes: “That’s consistent with what the company said yesterday, but contradicts what AOL HuffingtonPost spokesman Mario Ruiz told the Business Insider this morning. But since Sullivan reports directly to AOL CEO Tim Armstrong, we’ll take her word on this.”

Here’s the TechCrunch post about the whole thing, finally. Written by Paul Carr.

Reports came out from Fortune and the New York Times that famed blogger and TechCrunch founder Michael Arrington is launching a new venture fund to invest in early-stage startups.

According to Fortune, his partner is Patrick Gallagher of VantagePoint Venture and the goal is to raise about $20 million.

While the NYT reported that Arrington “will take a backseat role at TechCrunch, which is hiring a new managing editor,” and that “He will continue to report to Arianna Huffington, who runs AOL’s media properties,” Henry Blodget is reporting that Huffington said in an email that Arrington isn’t being paid by TechCrunch, won’t report to TechCrunch editors and won’t export to Huffington or other AOL Huffington Post Media Group Personnel.

Arrington himself has been pretty quiet about his plans. His tweets since the news came out have consisted of:

There has been plenty of outside chatter, however. Here are some tweets from others:

Jeff Jarvis lists “a few things to keep in mind” regarding Arrington in a Google+ post:

• Arrington started as a VC who happened to write a blog to keep track of companies he was interested in for investment. It turned into a media property by accident (but with much hard and purposeful work).
• Arrington has long rejected the title “journalist.” At Disrupt, I tried to get him to take on the uniform. He adamantly would not.
• NYTimesCo also invests in startups (including one where I am a partner, Daylife) and the NYTimes covers startups. NYTimes lab also created a startup with Betaworks (News.me). It, too, is in the business of startups.
• One difference: Arrington’s fund accepted capital from other VCs’ funds. An added layer of complexity, to be sure.

Robert Scoble says, “One thing, entrepreneurs will have a tough time with: He can be tough to work with if you aren’t very adept at PR and don’t know how to handle his personality. Getting questioned by him isn’t something that will be fun, either in a board meeting, or in public on a blog.”

That personality has been on public display in past Tech Crunch posts and tweetrs, where he has had plenty of “blog wars” for lack of a better term with other AOL staff (namely Engadget).

Swisher also had a whole lot more to say about the whole thing.

Note: The screenshot with the broken image on Arrington’s bio is real. Note 2: It’s not broken anymore. Probably meaningless, but still seems appropriate enough for a screenshot.