Gladstone Capital is a Business Development Company (BDC) that lends to lower middle market U.S. businesses. Gladstone Capital targets privately-held, PE-backed companies with EBITDA of roughly $3M–$25M, writing checks of $8M–$40M per deal to finance buyouts, acquisitions, and recapitalizations. The portfolio is predominantly debt — roughly 72% first lien, 18% second lien — with a small equity sleeve (~10%) consisting of warrants, preferred stock, and common equity taken alongside loans. As of September 2025, Gladstone Capital held investments in 55 companies with a total portfolio fair value of ~$859M. Gladstone Capital earns money primarily through interest income on floating-rate loans priced at spreads over SOFR, with the weighted average portfolio yield at ~12.8% as of mid-2025. Fees from loan originations and portfolio company exits supplement interest income. Gladstone Capital is externally managed by Gladstone Management, which earns a 1.75% base management fee on average total assets plus an incentive fee. As a regulated investment company (RIC), Gladstone Capital distributes at least 90% of taxable income to shareholders as monthly dividends. Growth is driven by new PE-sponsored originations, add-on financings for existing portfolio companies, and first-in/last-out (FILO) structures with bank partners on larger deals. Gladstone Capital argues it stays below the deal size threshold where large private credit funds compete, allowing it to price deals at wider spreads than the upper middle market.