Nvidia stunned Silicon Valley on Wednesday by agreeing to pay about $20 billion to license technology from Groq, one of the best-funded startups trying to challenge Nvidia's dominance in chips for powering AI applications, known as inference computing, according to a person involved in the deal. Nvidia is also hiring Groq's founders and other leaders, according to the startup, which didn't disclose the financial details.

It isn't clear whether the $20 billion figure includes future payouts from Nvidia based on performance milestones involving the Groq hires. Still, it is about three times Groq's $6.9 billion valuation in a financing just a few months ago.