The Elon Musk-backed artificial intelligence startup xAI is raising more financing than initially planned — including an equity investment from Nvidia Corp. — to bring its ongoing funding round to $20 billion, according to people with knowledge of the matter.

The financing, which includes equity and debt, will be tied to the Nvidia graphics processing units that xAI plans to use in Colossus 2, said the people, who asked not to be identified because the information is private. That’s the name of its largest data center site, which is located in Memphis.

Nvidia is investing as much as $2 billion in the equity portion of the deal, the people said, a strategy by the chipmaker that helps accelerate its customers’ AI investments. XAI’s fundraising effort, previously reported by Bloomberg at ha

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