Exhibit 99.1

Gladstone Investment Corporation Reports Financial Results for the Fiscal Year and Quarter Ended March 31, 2008

MCLEAN, Va.--(BUSINESS WIRE)--Gladstone Investment Corp. (NASDAQ:GAIN) (the “Company”) today announced earnings for the fourth quarter and fiscal year ended March 31, 2008. All per share references are per basic and diluted weighted average common share outstanding, unless otherwise noted.

Net Investment Income for the year ended March 31, 2008 was $13,051,550, or $0.79 per share compared to Net Investment Income for the year ended March 31, 2007 of $11,147,732, or $0.67 per share. For the three months ended March 31, 2008 Net Investment Income was $3,422,242, or $0.21 per share compared to $2,784,614, or $0.17 per share for the same period a year ago.

Net Decrease in Net Assets Resulting from Operations for the year ended March 31, 2008 was $941,161, or $0.06 per share compared to the Net Increase in Net Assets Resulting from Operations of $7,268,404, or $0.44 per share for the year ended March 31, 2007. The Net Decrease in Net Assets Resulting from Operations for the three months ended March 31, 2008 was $9,953,471, or $0.60 per share compared to the Net Increase in Net Assets Resulting from Operations of $458,769, or $0.03 per share for the three months ended March 31, 2007. The primary reason for the decrease in net assets for both the quarter and fiscal year end is directly related to the unrealized depreciation adjustments the Company recorded in the fourth quarter as a result of the devaluation in our overall investment portfolio.

Total assets were $352,293,092 at March 31, 2008 as compared to $323,590,215 at March 31, 2007. Net asset value was $12.47 per actual common share outstanding at March 31, 2008 as compared to $13.46 per actual common share outstanding at March 31, 2007.

The weighted average yield on our portfolio of investments, excluding cash and cash equivalents, was 8.91% for the year ended March 31, 2008 compared to 8.72% for the year ended March 31, 2007. The annualized weighted average yield on the Company’s portfolio for the three months ended March 31, 2008 was 8.42% compared to 8.72% for the three months ended March 31, 2007.

During the fourth quarter ended March 31, 2008, the Company recorded the following activity:

At March 31, 2008, the Company held 43 non-control/non-affiliate investments, six control investments and three affiliate investments, totaling an aggregate cost basis of approximately $351 million and a fair value of approximately $336 million.

Condensed Schedule of Investments
March 31, 2008
Investment Type   Cost   Fair Value
Total Non-Control/Non-Affiliate Investments   $ 166,416,086   $ 142,739,216
Total Control Investments 138,353,930 145,406,928
Total Affiliate Investments   46,034,721     47,457,910
Total Investments $ 350,804,737   $ 335,604,054

“Our investing activity continues to include proprietary investments and co- investments in support of equity sponsors. We are also expanding our efforts in the control investment category,” said Chip Stelljes, Co-Vice Chairman and Chief Investment Officer.

Subsequent to March 31, 2008, the Company:

The Company will hold a conference call on Thursday, May 22, 2008 at 8:30 am EDT to discuss fourth quarter and fiscal year financial results. Please call (877) 407-8031 to enter the conference. An operator will monitor the call and set a queue for the questions.

A replay of the conference call will be available through June 22, 2008. To hear the replay, please dial (877) 660-6853, access playback account 286 and use ID code 284214. The replay will be available approximately two hours after the call concludes.

The live audio broadcast of Gladstone Investment's quarterly conference call will be available online at www.GladstoneInvestment.com and www.investorcalendar.com. The online replay will follow shortly after the call and will be available through June 22, 2008.

Gladstone Investment Corporation is an investment company that seeks to make debt and equity investments in small and mid-sized private businesses in the U.S. in connection with acquisitions, changes in control and recapitalizations. For more information please visit our website at http://www.GladstoneInvestment.com.

For further information contact Kerry Finnegan at 703-287-5893.

This press release may include statements that may constitute “forward-looking statements,” including statements with regard to the future performance of the Company. Words such as “should,” “believes,” “feel,” “expects,” “projects,” “strive,” “goals,” and “future” or similar expressions are intended to identify forward-looking statements. These forward-looking statements inherently involve certain risks and uncertainties, although they are based on the Company’s current plans that are believed to be reasonable as of the date of this press release. Factors that may cause the Company’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements include, among others, those factors listed under the caption "Risk factors" of the Company’s Annual Report on Form 10-K for the year ended March 31, 2008, as filed with the SEC on May 21, 2008. The risk factors set forth in the Form 10-K under the caption “Risk Factors” are specifically incorporated by reference into this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

GLADSTONE INVESTMENT CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
   
Three months ended Three months ended
March 31, 2008 March 31, 2007
 
INVESTMENT INCOME
Interest income
Non-Control/Non-Affiliate investments $ 3,354,365 $ 2,634,567
Control investments 2,725,237 1,775,004
Affiliate investments 783,892 420,961
Cash and cash equivalents   23,119     51,141  
Total interest income 6,886,613 4,881,673
Other income   6,768     3,229  
Total investment income   6,893,381     4,884,902  
 
EXPENSES
Base management fee 492,651 198,679
Loan servicing fee 1,272,421 1,060,163
Administration fee 208,346 162,244
Interest expense 1,914,821 538,913
Amortization of deferred finance costs 138,663 142,387
Professional fees 60,172 231,703
Stockholder related costs 47,301 85,974
Insurance expense 48,422 61,406
Directors fees 54,708 53,800
Taxes and licenses 43,815 28,879
General and administrative expenses   66,215     38,498  
Expenses before credit from Adviser   4,347,535     2,602,646  
Credits to base management fee   (876,396 )   (502,358 )
Total expenses net of credit to base management fee   3,471,139     2,100,288  
NET INVESTMENT INCOME   3,422,242     2,784,614  
 
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Realized loss on sale of Non-Control/Non-Affiliate investments (2,213,942 ) (92,906 )
Net unrealized (depreciation) appreciation of Non-Control/Non-Affiliate investments (12,605,949 ) 627,501
Net unrealized appreciation (depreciation) of Control investments 397,358 (2,872,940 )
Net unrealized appreciation of Affiliate investments 1,104,703 12,500
Net unrealized depreciation on derivative   (57,883 )   -  
Net loss on investments   (13,375,713 )   (2,325,845 )
 
 
NET (DECREASE) INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ (9,953,471 ) $ 458,769  
 
NET (DECREASE) INCREASE IN NET ASSETS RESULTING FROM OPERATIONS PER COMMON SHARE:
Basic and Diluted $ (0.60 ) $ 0.03  
 
SHARES OF COMMON STOCK OUTSTANDING:
Basic and diluted weighted average shares 16,560,100 16,560,100
 
GLADSTONE INVESTMENT CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
     
For the period
June 22, 2005
(Commencement of
Year Ended Year Ended Operations) to
March 31, 2008 March 31, 2007 March 31, 2006
 
INVESTMENT INCOME
Interest income
Non-Control/Non-Affiliate investments $ 14,574,832 $ 9,572,593 $ 2,450,906
Control investments 10,768,484 5,486,060 255,059
Affiliate investments 2,285,836 535,629 -
Cash and cash equivalents   216,732     1,661,647     4,434,706  
Total interest income 27,845,884 17,255,929 7,140,671
Other income   47,596     5,707     230,185  
Total investment income   27,893,480     17,261,636     7,370,856  
 
EXPENSES
Base management fee 1,802,602 2,413,116 915,360
Loan servicing fee 5,013,503 1,568,854 -
Administration fee 855,086 526,595 288,471
Interest expense 7,733,385 607,661 378
Amortization of deferred finance costs 734,195 233,779 -
Professional fees 416,348 586,028 163,369
Stockholder related costs 267,613 273,483 89,563
Insurance expense 231,211 262,339 184,642
Directors fees 231,689 208,100 160,000
Taxes and licenses 168,833 168,873 195,270
General and administrative expenses   196,336     142,659     44,494  
Expenses before credit from Adviser   17,650,801     6,991,487     2,041,547  
Credits to base management fee   (2,808,871 )   (877,583 )   (554,589 )
Total expenses net of credit to base management fee   14,841,930     6,113,904     1,486,958  
NET INVESTMENT INCOME   13,051,550     11,147,732     5,883,898  
 
REALIZED AND UNREALIZED (LOSS) GAIN ON INVESTMENTS
Realized (loss) gain on sale of Non-Control/Non-Affiliate investments (2,411,654 ) (93,850 ) 57,431
Net unrealized (depreciation) appreciation of Non-Control/Non-Affiliate investments (23,277,742 ) (562,097 ) 162,968
Net unrealized appreciation (depreciation) of Control investments 10,338,879 (3,235,881 ) (50,000 )
Net unrealized appreciation of Affiliate investments 1,410,689 12,500 -
Net unrealized depreciation on derivative   (52,883 )   -     -  
Net (loss) gain on investments   (13,992,711 )   (3,879,328 )   170,399  
 
 
NET (DECREASE) INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ (941,161 ) $ 7,268,404   $ 6,054,297  
 
NET (DECREASE) INCREASE IN NET ASSETS RESULTING FROM OPERATIONS PER COMMON SHARE:
Basic and Diluted $ (0.06 ) $ 0.44   $ 0.37  
 
SHARES OF COMMON STOCK OUTSTANDING:
Basic and diluted weighted average shares 16,560,100 16,560,100 16,391,589
 

GLADSTONE INVESTMENT CORPORATION

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

   
 
March 31,
2008 		March 31,
2007
 
ASSETS

Non-Control/Non-Affiliate investments (Cost 3/31/08: $166,416,086; 3/31/07: $138,567,741)

$ 142,739,216 $ 138,168,612
Control investments (Cost 3/31/08: $138,353,930; 3/31/07: $116,302,372) 145,406,928 113,016,491
Affiliate investments (Cost 3/31/08: $46,034,721; 3/31/07: $19,750,000)   47,457,910     19,762,500  
Total investments at fair value (Cost 3/31/08: $350,804,737; 3/31/07: $274,620,113) 335,604,054 270,947,603
Cash and cash equivalents 9,360,154 37,788,941
Interest receivable 1,661,724 1,306,090
Prepaid insurance 90,521 83,819
Deferred finance costs 323,547 627,960
Due from Custodian 4,399,016 12,694,985
Due from Adviser 89,401 20,383
Other assets   764,675     120,434  
TOTAL ASSETS $ 352,293,092   $ 323,590,215  
 
LIABILITIES
Due to Administrator $ 208,346 $ 162,244
Borrowings under line of credit 144,834,500 100,000,000
Accrued expenses 716,107 523,698
Other liabilities   89,190     85,764  
Total Liabilities   145,848,143     100,771,706  
NET ASSETS $ 206,444,949   $ 222,818,509  
 
ANALYSIS OF NET ASSETS:
Common stock, $0.001 par value, 100,000,000 shares authorized and 16,560,100 shares issued and outstanding $ 16,560 $ 16,560
Capital in excess of par value 224,172,532 226,553,515
Net unrealized depreciation of investment portfolio (15,200,683 ) (3,672,510 )
Net unrealized depreciation of derivative (52,883 ) -

Accumulated net investment income

18,200 18,067

Accumulated net realized loss

  (2,508,777 )   (97,123 )
TOTAL NET ASSETS $ 206,444,949   $ 222,818,509  
Net assets per share $ 12.47   $ 13.46  
   
GLADSTONE INVESTMENT CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(UNAUDITED)
 
Three months ended
March 31, 2008 		Three months ended
March 31, 2007

Per Share Data (1)

Balance at beginning of period $ 13.31 $ 13.65
 
Income from investment operations:

Net investment income (2)

0.21 0.17

Realized loss on sale of investments (2)

(0.13 ) (0.01 )

Net unrealized depreciation of investments (2)

  (0.68 )   (0.13 )
Total from investment operations   (0.60 )   0.03  

Distributions (3)

  (0.24 )   (0.22 )
Net asset value at end of period $ 12.47   $ 13.46  
 
Per share market value at beginning of period $ 9.81 $ 15.31
Per share market value at end of period 9.41 14.87

Total Return (4)

(1.77 %) (1.41 %)
Shares outstanding at end of period 16,560,100 16,560,100
 

Statement of Assets and Liabilities Data:

Net assets at end of period $ 206,444,949 $ 222,818,509

Average net assets (5)

$ 214,143,553 $ 223,372,272
 

Senior Securities Data:

Borrowings under line of credit $ 144,834,500 $ 100,000,000
Average coverage ratio (6) 243 % 324 %
Average coverage per unit (7) $ 3,513 $ 3,228
 

Ratios/Supplemental Data

Ratio of expenses to average net assets (8) (9) 8.12 % 4.66 %
Ratio of net expenses to average net assets (8) (10) 6.48 % 3.76 %

Ratio of net investment income to average net assets (8)

6.39 % 4.99 %
 
(1)   Based on actual shares outstanding at the end of the corresponding period.
(2) Based on weighted average basic per share data.
(3) Distributions are determined based on taxable income calculated in accordance with income tax regulations which may differ from amounts determined under accounting principles generally accepted in the United States of America.
(4) Total return equals the change in the market value of the Company's common stock from the beginning of the period taking into account dividends reinvested in accordance with the terms of our dividend reinvestment plan.
(5) Calculated using the average of the ending monthly net assets for the respective periods.
(6) As a business development company, we are generally required to maintain a ratio of 200% of total assets to total borrowings.
(7) Asset coverage per unit is the ratio of the carrying value of our total consolidated assets, less all liabilities and indebtedness not represented by senior securities, to the aggregate amount of senior securities representing indebtedness. Asset coverage per unit is expressed in terms of dollar amounts per $1,000 of indebtedness.
(8) Amounts are annualized.
(9) Ratio of expenses to average net assets is computed using expenses before credit from the Adviser.
(10) Ratio of net expenses to average net assets is computed using total expenses net of credits to the management fee.
     
GLADSTONE INVESTMENT CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
 

For the year ended
March 31, 2008

For the year ended
March 31, 2007

For the period
June 22, 2005
(Commencement of
Operations) to
March 31, 2006

Per Share Data (1)

Balance at beginning of period $ 13.46 $ 13.88 $ -
Net proceeds from initial public offering (2) - - 13.95
Offering costs - - (0.05 )
 
Income from investment operations:
Net investment income (3) 0.79 0.67 0.36
Realized loss on sale of investments (3) (0.15 ) (0.01 ) -
Net unrealized (depreciation) appreciation of investments (3)   (0.70 )   (0.22 )   0.01  
Total from investment operations   (0.06 )   0.44     0.37  
 
Total distributions (4) (0.93 ) (0.85 ) (0.39 )
Shelf registration offering costs - (0.01 ) -
     
Net asset value at end of period $ 12.47   $ 13.46   $ 13.88  
 
Per share market value at beginning of period $ 14.87 $ 15.10 $ 15.00
Per share market value at end of period 9.41 14.87 15.10
Total Return (5) (31.54 %) 4.36 % 3.39 %
Shares outstanding at end of period 16,560,100 16,560,100 16,560,100
 

Statement of Assets and Liabilities Data:

Net assets at end of period $ 206,444,949 $ 222,818,509 $ 229,841,697

Average net assets (6)

$ 219,625,608 $ 225,642,593 $ 226,875,738
 

Senior Securities Data:

Borrowings under line of credit $ 144,834,500 $ 100,000,000 $ -
Average coverage ratio (7) 243 % 324 % N/A
Average coverage per unit (8) $ 3,513 $ 3,228 N/A
 

Ratios/Supplemental Data

Ratio of expenses to average net assets (9) (10) 8.04 % 3.10 % 1.08 %
Ratio of net expenses to average net assets (9) (11) 6.76 % 2.71 % 0.79 %

Ratio of net investment income to average net assets (9)

5.94 % 4.94 % 3.11 %
 
(1)   Based on actual shares outstanding at the end of the corresponding period.
(2) Net of initial underwriting discount of $1.05 per share.
(3) Based on weighted average basic per share data.
(4) Distributions are determined based on taxable income calculated in accordance with income tax regulations which may differ from amounts determined under accounting principles generally accepted in the United States of America.
(5) Total return equals the change in the market value of the Company's common stock from the beginning of the period taking into account dividends reinvested in accordance with the terms of our dividend reinvestment plan.
(6) Calculated using the average of the ending monthly net assets for the respective periods.
(7) As a business development company, we are generally required to maintain a ratio of 200% of total assets to total borrowings.
(8) Asset coverage per unit is the ratio of the carrying value of our total consolidated assets, less all liabilities and indebtedness not represented by senior securities, to the aggregate amount of senior securities representing indebtedness. Asset coverage per unit is expressed in terms of dollar amounts per $1,000 of indebtedness.
(9) Amounts are annualized.
(10) Ratio of expenses to average net assets is computed using expenses before credit from the Adviser.
(11) Ratio of net expenses to average net assets is computed using total expenses net of credits to the management fee.

CONTACT:
Gladstone Investment Corporation
Kerry Finnegan, 703-287-5893