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Filed Pursuant to Rule 497
Registration No. 333-187447

PROSPECTUS SUPPLEMENT

(To prospectus dated June 12, 2013)

Up to 8,000,000 Shares

Common Stock

We have entered into an equity distribution agreement, dated August 16, 2013, with JMP Securities LLC, or JMP Securities, relating to the shares of common stock offered by this prospectus supplement and the accompanying prospectus. Our common stock is listed on the New York Stock Exchange, or NYSE, under the trading symbol “HTGC.” The last sale price, as reported on NYSE on August 15, 2013, was $14.57 per share. The net asset value per share of our common stock at June 30, 2013 (the last date prior to the date of this prospectus supplement on which we determined net asset value) was $10.09.

We are an internally-managed, non-diversified closed-end management investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Our investment objective is to maximize our portfolio total return by generating current income from our debt investments and capital appreciation from our equity-related investments.

The equity distribution agreement provides that we may offer and sell up to 8,000,000 shares of our common stock from time to time through JMP Securities, as our sales agent. Sales of our common stock, if any, under this prospectus supplement and the accompanying prospectus may be made in negotiated transactions or transactions that are deemed to be “at the market,” as defined in Rule 415 under the Securities Act of 1933, as amended, including sales made directly on the NYSE or similar securities exchange or sales made to or through a market maker other than on an exchange, at prices related to the prevailing market prices or at negotiated prices.

JMP Securities will receive a commission from us to be negotiated from time to time, but in no event in excess of 2.0% of the gross sales price of any shares of our common stock sold through JMP Securities under the equity distribution agreement. JMP Securities is not required to sell any specific number or dollar amount of common stock, but will use its commercially reasonable efforts consistent with its sales and trading practices to sell the shares of our common stock offered by this prospectus supplement and the accompanying prospectus. See “Plan of Distribution” beginning on page S-13 of this prospectus supplement. The sales price per share of our common stock offered by this prospectus supplement and the accompanying prospectus, less JMP Securities’ commission, will not be less than the net asset value per share of our common stock at the time of such sale.

Please read this prospectus supplement, and the accompanying prospectus, before investing, and keep it for future reference. The prospectus supplement and the accompanying prospectus contain important information about us that a prospective investor should know before investing in our common stock. We file annual, quarterly and current reports, proxy statements and other information about us with the Securities and Exchange Commission, or the SEC. This information is available free of charge by contacting us at 400 Hamilton Avenue, Suite 310, Palo Alto, California 94301, or by telephone by calling collect at (650) 289-3060 or on our website at www.htgc.com. The information on our website is not incorporated by reference into this prospectus or the accompanying prospectus. The SEC also maintains a website at www.sec.gov that contains such information.

An investment in our common stock involves risks, including the risk of a total loss of investment. In addition, the companies in which we invest are subject to special risks. See the “Risk Factors” section beginning on page 11 of the accompanying prospectus to read about risks that you should consider before investing in our common stock, including the risk of leverage.

Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

JMP Securities

The date of this prospectus supplement is August 16, 2013.

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You should rely only on the information contained in this prospectus supplement and the accompanying prospectus. We have not, and JMP Securities has not, authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not, and JMP Securities is not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information contained in this prospectus supplement and the accompanying prospectus is accurate only as of the date on the front cover of this prospectus supplement or such prospectus, as applicable. Our business, financial condition, results of operations and prospects may have changed since that date.

This document is in two parts. The first part is this prospectus supplement, which describes the terms of this offering and also adds to and updates information contained in the accompanying prospectus. The second part is the accompanying prospectus, which gives more general information and disclosure. To the extent the information contained in this prospectus supplement differs from the information contained in the accompanying prospectus, the information in this prospectus supplement shall control. You should read this prospectus supplement and the accompanying prospectus together with the additional information described under the heading, “Available Information” before investing in our common stock.

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Prospectus Supplement

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USE OF PROCEEDS

Sales of our common stock, if any, under this prospectus supplement and the accompanying prospectus may be made in negotiated transactions or transactions that are deemed to be “at the market” as defined in Rule 415 under the Securities Act, including sales made directly on the NYSE or sales made to or through a market maker other than on an exchange. There is no guarantee that there will be any sales of our common stock pursuant to this prospectus supplement and the accompanying prospectus. Actual sales, if any, of our common stock under this prospectus supplement and the accompanying prospectus may be less than as set forth in this paragraph depending on, among other things, the market price of our common stock at the time of any such sale. As a result, the actual net proceeds we receive may be more or less than the amount of net proceeds estimated in this prospectus supplement. Assuming the sale of all 8,000,000 shares of common stock offered under this prospectus supplement and the accompanying prospectus, at the last reported sale price of $14.57 per share for our common stock on the NYSE as of August 15, 2013, we estimate that the net proceeds of this offering will be approximately $114.0 million after deducting the estimated sales commission payable to JMP Securities and our estimated offering expenses.

We expect to use the net proceeds from this offering to fund investments in debt and equity securities in accordance with our investment objective and for other general corporate purposes.

We intend to seek to invest the net proceeds received in this offering as promptly as practicable after receipt thereof consistent with our investment objective. We anticipate that substantially all of the net proceeds from any offering of our securities will be used as described above within three to six months, depending on market conditions. We anticipate that the remainder will be used for working capital and general corporate purposes, including potential payments or distributions to shareholders. Pending such use, we will invest a portion of the net proceeds of this offering in short-term investments, such as cash and cash equivalents, which we expect will earn yields substantially lower than the interest income that we anticipate receiving in respect of investments in accordance with our investment objective.

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CAPITALIZATION

The equity distribution agreements provide that we may offer and sell up to 8,000,000 shares of our common stock from time to time through JMP Securities, as our sales agent for the offer and sale of such common stock. The table below assumes that we will sell all of the 8,000,000 shares at a price of $14.57 per share (the last reported sale price per share of our common stock on the NYSE on August 15, 2013) but there is no guarantee that there will be any sales of our common stock pursuant to this prospectus supplement and the accompanying prospectus. Actual sales, if any, of our common stock under this prospectus supplement and the accompanying prospectus may be less than as set forth in the table below. In addition, the price per share of any such sale may be greater or less than $14.57, depending on the market price of our common stock at the time of any such sale. The following table sets forth our capitalization as of June 30, 2013:

This table should be read in conjunction with “Use of Proceeds” in this prospectus supplement and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and notes thereto included in the accompanying prospectus. The adjusted information is illustrative only.

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PLAN OF DISTRIBUTION

JMP Securities is acting as our sales agent in connection with the offer and sale of shares of our common stock pursuant to this prospectus supplement and the accompanying prospectus. Upon written instructions from us, JMP Securities will use its commercially reasonable efforts consistent with its sales and trading practices to sell, as our sales agent, our common stock under the terms and subject to the conditions set forth in our equity distribution agreement with JMP Securities dated August 16, 2013. We will instruct JMP Securities as to the amount of common stock to be sold by it. We may instruct JMP Securities not to sell common stock if the sales cannot be effected at or above the price designated by us in any instruction. The sales price per share of our common stock offered by this prospectus supplement and the accompanying prospectus, less JMP Securities’ commission, will not be less than the net asset value per share of our common stock at the time of such sale. We or JMP Securities may suspend the offering of shares of common stock upon proper notice and subject to other conditions.

Sales of our common stock, if any, under this prospectus supplement and the accompanying prospectus may be made in negotiated transactions or transactions that are deemed to be “at the market,” as defined in Rule 415 under the Securities Act, including sales made directly on the NYSE or similar securities exchange or sales made to or through a market maker other than on an exchange at prices related to the prevailing market prices or at negotiated prices.

JMP Securities will provide written confirmation of a sale to us no later than the opening of the trading day on the NYSE following each trading day in which shares of our common stock are sold under the equity distribution agreement. Each confirmation will include the number of shares of common stock sold on the preceding day, the net proceeds to us and the compensation payable by us to JMP Securities in connection with the sales.

JMP Securities will receive a commission from us to be negotiated from time to time but in no event in excess of 2.0% of the gross sales price of any shares of our common stock sold through JMP Securities under the equity distribution agreement. We estimate that the total expenses for the offering, excluding compensation payable to JMP Securities under the terms of the equity distribution agreement, will be approximately $285,000 (including up to $10,000 in reimbursement of the underwriters’ counsel fees in connection with the review of the terms of the offering by the Financial Industry Regulatory Authority, Inc.).

Settlement for sales of shares of common stock will occur on the third trading day following the date on which such sales are made, or on some other date that is agreed upon by us and JMP Securities in connection with a particular transaction, in return for payment of the net proceeds to us. There is no arrangement for funds to be received in an escrow, trust or similar arrangement.

We will report at least quarterly the number of shares of our common stock sold through JMP Securities under the equity distribution agreement and the net proceeds to us.

In connection with the sale of the common stock on our behalf, JMP Securities may be deemed to be an “underwriter” within the meaning of the Securities Act, and the compensation of JMP Securities may be deemed to be underwriting commissions or discounts. We have agreed to provide indemnification and contribution to JMP Securities against certain civil liabilities, including liabilities under the Securities Act.

The offering of our shares of common stock pursuant to the equity distribution agreement will terminate upon the earlier of (i) the sale of all common stock subject to the equity distribution agreement or (ii) the termination of the equity distribution agreement. The equity distribution agreement may be terminated by us in our sole discretion under the circumstances specified in the equity distribution agreement by giving notice to JMP Securities. In addition, JMP Securities may terminate the equity distribution agreement under the circumstances specified in the equity distribution agreement by giving notice to us.

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Potential Conflicts of Interest

JMP Securities and its affiliates have provided, or may in the future provide, various investment banking, commercial banking, financial advisory, brokerage and other services to us and our affiliates for which services they have received, and may in the future receive, customary fees and expense reimbursement. JMP Securities and its affiliates may, from time to time, engage in transactions with and perform services for us in the ordinary course of their business for which they may receive customary fees and reimbursement of expenses. In the ordinary course of their various business activities, JMP Securities and its affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers and such investment and securities activities may involve securities and/or instruments of our company.

The principal business address of JMP Securities is 600 Montgomery Street, San Francisco, CA 94111.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our consolidated financial statements and related notes and other financial information appearing elsewhere in this prospectus supplement and the accompanying prospectus. In addition to historical information, the following discussion and other parts of this prospectus supplement and the accompanying prospectus contain forward-looking information that involves risks and uncertainties. Our actual results could differ materially from those anticipated by such forward-looking information due to the factors discussed under “Risk Factors” and “Forward-Looking Statements” appearing elsewhere herein and the accompanying prospectus. Capitalized terms used and not otherwise defined herein have the meaning given in the accompanying prospectus.

Overview

We are a specialty finance company focused on providing senior secured loans to venture capital-backed companies in technology-related markets, including technology, biotechnology, life science, and clean-technology industries at all stages of development. We source our investments through our principal office located in Silicon Valley, as well as through our additional offices in Boston, MA, New York, NY, Chicago, IL, Boulder, CO and McLean, VA.

Our goal is to be the leading structured debt financing provider of choice for venture capital-backed companies in technology-related markets requiring sophisticated and customized financing solutions. Our strategy is to evaluate and invest in a broad range of technology-related markets including technology, biotechnology, life science, and clean-technology industries and to offer a full suite of growth capital products up and down the capital structure. We invest primarily in structured debt with warrants and, to a lesser extent, in senior debt and equity investments. We invest primarily in private companies and to a lesser extent public companies. We use the term “structured debt with warrants” to refer to any debt investment, such as a senior or subordinated secured loan, that is coupled with an equity component, including warrants, options or rights to purchase common or preferred stock. Our structured debt with warrants investments will typically be secured by some or all of the assets of the portfolio company.

Our investment objective is to maximize our portfolio total return by generating current income from our debt investments and capital appreciation from our equity-related investments. Our primary business objectives are to increase our net income, net operating income and net asset value by investing in structured debt with warrants and equity of venture capital-backed companies in technology-related markets with attractive current yields and the potential for equity appreciation and realized gains. Our structured debt investments typically include warrants or other equity interests, giving us the potential to realize equity-like returns on a portion of our investments. Our equity ownership in our portfolio companies may represent a controlling interest. In some cases, we receive the right to make additional equity investments in our portfolio companies in connection with future equity financing rounds. Capital that we provide directly to venture capital-backed companies in technology-related markets is generally used for growth and general working capital purposes as well as in select cases for acquisitions or recapitalizations.

We also make investments in qualifying small businesses through two wholly-owned SBICs, HT II and HT III hold approximately $156.8 million and $265.3 million in assets, respectively, and accounted for approximately 10.1% and 17.0% of our total assets prior to consolidation at June 30, 2013. We have issued $225.0 million in SBA-guaranteed debentures in our SBIC subsidiaries, which is the maximum amount allowed for a group of SBICs under common control.

We are an internally managed, non-diversified closed-end investment company that has elected to be regulated as a business development company under the 1940 Act. As a business development company, we are required to comply with certain regulatory requirements. For instance, we generally have to invest at least 70%

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of our total assets in “qualifying assets,” including securities of private U.S. companies, cash, cash equivalents, and high-quality debt investments that mature in one year or less.

From incorporation through December 31, 2005, we were taxed as a corporation under Subchapter C of the Internal Revenue Code, or the Code. As of January 1, 2006, we have elected to be treated for federal income tax purposes as a regulated investment company, or a RIC, under Subchapter M of the Code. Pursuant to this election, we generally will not have to pay corporate-level taxes on any income that we distribute to our stockholders. However, such an election and qualification to be treated as a RIC requires that we comply with certain requirements contained in Subchapter M of the Code. For example, a RIC must meet certain requirements, including source-of income, asset diversification and income distribution requirements. The income source requirement mandates that we receive 90% or more of our income from qualified earnings, typically referred to as “good income.”

Our portfolio is comprised of, and we anticipate that our portfolio will continue to be comprised of, investments primarily in technology-related companies at various stages of their development. Consistent with regulatory requirements, we invest primarily in United States based companies and to a lesser extent in foreign companies.

We regularly engage in discussions with third parties with respect to various potential transactions. We may acquire an investment or a portfolio of investments or an entire company or sell a portion of our portfolio on an opportunistic basis. We, our subsidiaries or our affiliates may also agree to manage certain other funds that invest in debt, equity or provide other financing or services to companies in a variety of industries for which we may earn management or other fees for our services. We may also invest in the equity of these funds, along with other third parties, from which we would seek to earn a return and/or future incentive allocations. Some of these transactions could be material to our business. Consummation of any such transaction will be subject to completion of due diligence, finalization of key business and financial terms (including price) and negotiation of final definitive documentation as well as a number of other factors and conditions including, without limitation, the approval of our board of directors and required regulatory or third party consents and, in certain cases, the approval of our stockholders. Accordingly, there can be no assurance that any such transaction would be consummated. Any of these transactions or funds may require significant management resources either during the transaction phase or on an ongoing basis depending on the terms of the transaction.

Portfolio and Investment Activity

The total value of our investment portfolio was $1,041.1 million at June 30, 2013 as compared to $906.3 million at December 31, 2012.

The fair value of the loan portfolio at June 30, 2013 was approximately $949.7 million, compared to a fair value of approximately $827.5 million at December 31, 2012. The fair value of the equity portfolio at June 30, 2013 was approximately $56.2 million, compared to a fair value of approximately $49.2 million at December 31, 2012. The fair value of the warrant portfolio at June 30, 2013 was approximately $35.2 million, compared to a fair value of approximately $29.5 million at December 31, 2012.

Portfolio Activity

Our investments in portfolio companies take a variety of forms, including unfunded contractual commitments and funded investments. From time to time, unfunded contractual commitments are dependent upon a portfolio company reaching certain milestones before the debt commitment is available to the portfolio company, which is expected to affect our funding levels. These commitments will be subject to the same underwriting and ongoing portfolio maintenance as the on-balance sheet financial instruments that we hold. Debt commitments generally fund over the two succeeding quarters from close. Not all debt commitments represent

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our future cash requirements. Similarly, unfunded contractual commitments may expire without being drawn and do not represent our future cash requirements.

Prior to entering into a contractual commitment, we generally issue a non-binding term sheet to a prospective portfolio company. Non-binding term sheets are subject to completion of our due diligence and final approval process, as well as the negotiation of definitive documentation with the prospective portfolio companies and generally convert to contractual commitments within approximately 45 to 60 days of signing. Not all non-binding term sheets are expected to close and do not necessarily represent our future cash requirements.

Our portfolio activity for the six-month period ended June 30, 2013 (unaudited) and the year ended December 31, 2012 was comprised of the following:

We receive payments in our loan portfolio based on scheduled amortization of the outstanding balances. In addition, we receive repayments of some of our loans prior to their scheduled maturity date. The frequency or volume of these repayments may fluctuate significantly from period to period. During the six-month period ended June 30, 2013, we received approximately $206.4 million in principal repayments, including approximately $35.0 million of principal repayments related to a renewal of an existing debt investment, $93.3 million of early principal repayments and approximately $78.1 million in scheduled principal payments.

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Total portfolio investment activity (inclusive of unearned income) for the six-month period ended June 30, 2013 (unaudited) and for the year ended December 31, 2012 was as follows:

The following table shows the fair value of our portfolio of investments by asset class as of June 30, 2013 (unaudited) and December 31, 2012.

A summary of our investment portfolio at value by geographic location is as follows:

As of June 30, 2013, we held warrants or equity positions in six companies which have filed registration statements on Form S-1 with the SEC in contemplation of potential initial public offerings. ADMA Biologics, Inc., iWatt, Inc., Paratek Pharmaceuticals, Inc. and three additional companies that filed a Form S-1 Registration confidentially under the JOBS Act. There can be no assurance that these companies will complete their initial public offerings in a timely manner or at all.

Subsequent to quarter end, iWatt Inc. withdrew its Form S-1 Registration Statement due to the company being acquired by Dialog Semiconductor PLC (GR: DLG) for a total potential transaction value of approximately

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$345.0 million, subject to closing conditions, and Paratek Pharmaceuticals, Inc. withdrew its Form S-1 Registration Statement for an IPO.

Changes in Portfolio

We generate revenue in the form of interest income, primarily from our investments in debt securities, and commitment and facility fees. Fees generated in connection with our debt investments are recognized over the life of the loan or, in some cases, recognized as earned. In addition, we generate revenue in the form of capital gains, if any, on warrants or other equity-related securities that we acquire from our portfolio companies. Our investments generally range from $1.0 million to $25.0 million. Our debt investments have a term of between two and seven years and typically bear interest at a rate ranging from Prime to approximately 14.0% as of June 30, 2013. In addition to the cash yields received on our loans, in some instances, our loans may also include any of the following: end-of-term payments, exit fees, balloon payment fees, commitment fees, success fees, PIK provisions or prepayment fees which may be required to be included in income prior to receipt. Loan origination and commitment fees received in full at the inception of a loan are deferred and amortized into fee income as an enhancement to the related loan’s yield over the contractual life of the loan. We recognize nonrecurring fees amortized over the remaining term of the loan commencing in the quarter relating to specific loan modifications. Loan exit fees to be paid at the termination of the loan are accreted into interest income over the contractual life of the loan. We had approximately $4.0 million and $2.0 million of unamortized fees at June 30, 2013 and December 31, 2012, respectively, and approximately $9.2 million and $6.8 million in exit fees receivable at June 30, 2013 and December 31, 2012, respectively. The increase of both unamortized fees and exit fees receivable is attributable to overall growth of the loan portfolio.

We have loans in our portfolio that contain a PIK provision. The PIK interest, computed at the contractual rate specified in each loan agreement, is added to the principal balance of the loan and recorded as interest income. To maintain our status as a RIC, this non-cash source of income must be paid out to stockholders in the form of dividends even though we have not yet collected the cash. Amounts necessary to pay these dividends may come from available cash or the liquidation of certain investments. We recorded approximately $983,000 and $271,000 in PIK income during the three-months ended June 30, 2013 and 2012, respectively. We recorded approximately $1.8 million and $569,000 in PIK income in the six-month periods ended June 30, 2013 and 2012, respectively.

In some cases, we may collateralize our investments by obtaining a first priority security interest in a portfolio company’s assets, which may include their intellectual property. In other cases, we may obtain a negative pledge covering a company’s intellectual property. At June 30, 2013, approximately 62.5% of our portfolio company loans were secured by a first priority security in all of the assets of the portfolio company, 36.3% of the loans were to portfolio companies that were prohibited from pledging or encumbering their intellectual property and 1.2% of portfolio company loans had an equipment only lien.

Interest on debt securities is generally payable monthly, with amortization of principal typically occurring over the term of the security. In addition, certain loans may include an interest-only period ranging from three to eighteen months or longer. In limited instances in which we choose to defer amortization of the loan for a period of time from the date of the initial investment, the principal amount of the debt securities and any accrued but unpaid interest become due at the maturity date.

The effective yield on our debt investments during the three-month periods ended June 30, 2013 and 2012 was 15.7% and 15.2%, respectively. Excluding the effect of fee accelerations that occurred from early payoffs and one-time events, the adjusted effective yield for the three-month period ended June 30, 2013 was 14.2%. The adjusted effective yield for the three-month period ended December 31, 2012 was 13.6%. The effective yield is derived by dividing total investment income by the weighted average earning investment portfolio assets outstanding during the quarter which exclude non-interest earning assets such as warrants and equity investments. The overall weighted average yield to maturity of our loan investments was approximately 13.22% at June 30, 2013, a slight increase compared to 12.91% at December 31, 2012. The weighted average yield to

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maturity is computed using the interest rates in effect at the inception of each of the loans, and includes amortization of the loan facility fees, commitment fees and market premiums or discounts over the expected life of the debt investments, weighted by their respective costs when averaged and based on the assumption that all contractual loan commitments have been fully funded and held to maturity.

Portfolio Composition

Our portfolio companies are primarily privately held companies and, to a lesser extent, public companies which are active in the drug discovery and development, internet consumer and business services, clean technology, software, drug delivery, medical device and equipment, media/content/info, communications and networking, information services, healthcare services, diagnostic, specialty pharmaceuticals, biotechnology tools, surgical devices, consumer and business products, semiconductors, electronics and computer hardware and therapeutic industry sectors. These sectors are characterized by high margins, high growth rates, consolidation and product and market extension opportunities. Value is often vested in intangible assets and intellectual property.

As of June 30, 2013, approximately 59.9% of the fair value of our portfolio was composed of investments in four industries: 20.8% was composed of investments in the drug discovery and development industry, 14.5% was composed of investments in the internet consumer and business services industry, 15.1% was composed of investments in the clean technology industry and 9.5% was composed of investments in the medical device and equipment industry.

The following table shows the fair value of our portfolio by industry sector at June 30, 2013 (unaudited) and December 31, 2012:

Industry and sector concentrations vary as new loans are recorded and loans pay off. Loan revenue, consisting of interest, fees, and recognition of gains on equity interests, can fluctuate dramatically when a loan is paid off or a related warrant or equity interest is sold. Revenue recognition in any given year can be highly concentrated among several portfolio companies.

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For the six-months ended June 30, 2013 and the year ended December 31, 2012, our ten largest portfolio companies represented approximately 30.6% and 35.2% of the total fair value of our investments in portfolio companies, respectively. At June 30, 2013 and December 31, 2012, we had four and eight investments, respectively, that represented 5% or more of our net assets. At June 30, 2013, we had seven equity investments representing approximately 67.9% of the total fair value of our equity investments, and each represented 5% or more of the total fair value of our equity investments. At December 31, 2012, we had six equity investments which represented approximately 70.9% of the total fair value of our equity investments, and each represented 5% or more of the total fair value of such investments.

As of June 30, 2013, over 98.8% of our debt investments were in a senior secured first lien position, and more than 98.1% of the debt investment portfolio was priced at floating interest rates or floating interest rates with a Prime or LIBOR based interest rate floor. As a result, we believe we are well positioned to benefit should market rates increase. Our investments in senior secured debt with warrants have equity enhancement features, typically in the form of warrants or other equity-related securities designed to provide us with an opportunity for capital appreciation. Our warrant coverage generally ranges from 3% to 20% of the principal amount invested in a portfolio company, with a strike price equal to the most recent equity financing round. As of June 30, 2013, we held warrants in 120 portfolio companies, with a fair value of approximately $35.2 million. The fair value of the warrant portfolio has increased by approximately 19.3% as compared to the fair value of $29.5 million at December 31, 2012. These warrant holdings would require us to invest approximately $74.8 million to exercise such warrants. Warrants may appreciate or depreciate in value depending largely upon the underlying portfolio company’s performance and overall market conditions. Of the warrants which have monetized since inception, we have realized warrant gain multiples in the range of approximately 1.04x to 14.91x based on the historical rate of return on our investments. However, these warrants may not appreciate in value and, in fact, may decline in value. Accordingly, we may not be able to realize gains from our warrant interests.

As required by the 1940 Act, we classify our investments by level of control. “Control investments” are defined in the 1940 Act as investments in those companies that we are deemed to “control”. Generally, under the 1940 Act, we are deemed to “control” a company in which we have invested if we own 25% or more of the voting securities of such company or have greater than 50% representation on its board. “Affiliate investments” are investments in those companies that are “affiliated companies” of ours, as defined in the 1940 Act, which are not control investments. We are deemed to be an “affiliate” of a company in which we have invested if we own 5% or more but less than 25% of the voting securities of such company. “Non-control/non-affiliate investments” are investments that are neither control investments nor affiliate investments.

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The following table summarizes our realized and unrealized gain and loss and changes in our unrealized appreciation and depreciation on control and affiliate investments for the three and six-month periods ended June 30, 2013 and 2012 (unaudited):

Our investment in MaxVision Holding, L.L.C., a company that was a Control Investment as of June 30, 2012, was liquidated during the year ended December 31, 2012. On July 31, 2012, we received payment of $2.0 million for our total debt investments in Maxvision Holding, L.L.C. Approximately $8.7 million of realized losses and $10.5 million of net change in unrealized appreciation was recognized on this control debt and equity investment during the year ended December 31, 2012.

Our investment in E-Band Communications, Corp., a company that was a Non-Controlled Affiliate Investment as of June 30, 2012, was liquidated during the period ended June 30, 2013. Approximately $3.3 million of realized losses and $3.3 million of net change in unrealized appreciation was recognized on this non-controlled affiliate equity investment during the six-months ended June 30, 2013.

During the year ended December 31, 2012, Optiscan BioMedical, Corp. became a non-controlled affiliate as a company in which we own 5% or more but less than 25% of the voting securities of the company.

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Portfolio Grading

We use an investment grading system, which grades each debt investment on a scale of 1 to 5, to characterize and monitor our expected level of risk on the debt investments in our portfolio with 1 being the highest quality. The following table shows the distribution of our outstanding debt investments on the 1 to 5 investment grading scale at fair value as of June 30, 2013 (unaudited) and December 31, 2012, respectively:

As of June 30, 2013, our investments had a weighted average investment grading of 2.11 as compared to 2.06 at December 31, 2012. Our policy is to lower the grading on our portfolio companies as they approach the point in time when they will require additional equity capital. Additionally, we may downgrade our portfolio companies if they are not meeting our financing criteria and their respective business plans. Various companies in our portfolio will require additional funding in the near term or have not met their business plans and have therefore been downgraded until their funding is complete or their operations improve.

At June 30, 2013, we had two loans on non-accrual, one with a fair value of approximately $5.5 million and the other with no fair market value compared to one loan on non-accrual at December 31, 2012 with no fair market value.

Results of Operations

Comparison of the three and six-month periods ended June 30, 2013 and 2012

Investment Income

Total investment income for the three-month period ended June 30, 2013 was approximately $34.5 million as compared to approximately $23.9 million for the three-month period ended June 30, 2012. Total investment income for the six-month period ended June 30, 2013 was approximately $65.5 million as compared to approximately $46.2 million for the six-month period ended June 30, 2012.

Interest income for the three-month period ended June 30, 2013 totaled approximately $30.3 million as compared to approximately $21.1 million for the three-month period ended June 30, 2012. Interest income for the six-month period ended June 30, 2012 totaled approximately $59.2 million as compared to approximately $41.4 million for the six-month period ended June 30, 2012. In general, the increase in interest income is attributable to overall growth in the loan portfolio. Specifically, the increase in interest income is attributable to an increase of loan interest income of approximately $7.3 million and $14.3 million for the three and six-month periods ended June 30, 2013, respectively, and an increase of PIK interest income of approximately $712,000 and $1.2 million for the three and six-month periods ended June 30, 2013, respectively.

Income from commitment, facility and loan related fees for the three-month period ended June 30, 2013 totaled approximately $4.2 million as compared to approximately $2.7 million for the three-month period ended June 30, 2012. Income from commitment, facility and loan related fees for the six-month period ended June 30, 2013 totaled approximately $6.3 million as compared to approximately $4.8 million for the six-month period

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ended June 30, 2012. The increase in fee income is attributable to additional fee accelerations due to early pay-offs during the three and six-month periods ended June 30, 2013 as compared to the same periods in 2012.

The following table shows the PIK-related activity for the six-months ended June 30, 2013 and 2012, at cost (unaudited):

The increase in payments received from PIK loans and PIK interest capitalized during the six-months ended June 30, 2013 is due to the addition of three PIK loans which have incurred PIK capitalizations during the period and the payoff of two PIK loans during the period ended June 30, 2013.

In certain investment transactions, we may provide advisory services. For services that are separately identifiable and external evidence exists to substantiate fair value, income is recognized as earned, which is generally when the investment transaction closes. We had no income from advisory services in the three and six-month periods ended June 30, 2013 and 2012, respectively.

Operating Expenses

Operating expenses, which are comprised of interest and fees on borrowings, general and administrative and employee compensation, totaled approximately $16.9 million and $11.5 million during the three month periods ended June 30, 2013 and 2012, respectively. Operating expenses totaled approximately $32.8 million and $22.5 million during the six month periods ended June 30, 2013 and 2012, respectively.

Interest and Fees on Borrowing

Interest and fees on borrowings totaled approximately $8.8 million for the three-month period ended June 30, 2013 as compared to approximately $5.2 million for the three-month period ended June 30, 2012. This increase was primarily attributable to interest and fee expenses of approximately $3.2 million for the three-month period ended June 30, 2013 related to the 2019 Notes issued in April 2012 and September 2012 and approximately $1.3 million related to the Asset-Backed Notes issued in December 2012. These expenses were partially offset by a decrease in interest and fees of approximately $236,000 for the three-month period ended June 30, 2013 associated with our SBA debentures due to the pay down in August 2012 of $12.0 million priced at 6.43%, including annual fees, and $12.75 million priced at 6.38%, including annual fees. Additional borrowings in November 2012 of SBA debentures priced on March 27, 2013 at 3.16%, including annual fees.

Interest and fees on borrowings totaled approximately $17.5 million for the six-month period ended June 30, 2013 as compared to approximately $10.2 million for the six-month period ended June 30, 2012. This increase was primarily attributable to interest and fee expenses of approximately $6.4 million for the six-month period ended June 30, 2013 related to the 2019 Notes issued in April 2012 and September 2012 and approximately $2.6 million related to the Asset-Backed Notes issued in December 2012. These expenses were partially offset by a decrease in interest and fees of approximately $936,000 for the six-month period ended June 30, 2013 associated with our SBA debentures due to the pay down in August 2012 discussed above.

We had a weighted average cost of debt comprised of interest and fees of approximately 6.0% at June 30, 2013, as compared to 6.7% during June 30, 2012. The decrease was primarily driven by the Asset-Backed Notes issued in December 2012, which account for approximately 19.1% of our outstanding debt and accrue interest at 3.32%. As of June 30, 2013 the weighted average debt outstanding was approximately $589.2 million.

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General and Administrative Expenses

General and administrative expenses include legal fees, consulting fees, accounting fees, printer fees, insurance premiums, rent, workout and various other expenses. Expenses increased to $2.4 million from $1.9 million for the three-month periods ended June 30, 2013 and 2012, respectively. These increases were primarily due to increases of approximately $357,000, $187,000 and $53,000 related to outside consulting services, legal fees and SEC printing fees, respectively, partially offset by a decrease of approximately $89,000 for marketing expenses in the three-month period ended June 30, 2013. Expenses increased to $4.6 million from $3.7 million for the six-month periods ended June 30, 2013 and 2012, respectively. These increases were primarily due to increases of approximately $424,000, $279,000 and $196,000 related to outside consulting services, office and transportation expenses as a result of increased headcount and legal fees, respectively, partially offset by a decrease of approximately $50,000 for marketing expenses in the six-month period ended June 30, 2013.

Employee Compensation

Employee compensation and benefits totaled approximately $4.2 million for the three-month period ended June 30, 2013 as compared to approximately $3.3 million for the three-month period ended June 30, 2012 and approximately $8.0 million for the six-month period ended June 30, 2013 as compared to approximately $6.6 million for the six-month period ended June 30, 2012. This increase was due to increasing our staff to 59 active employees from 51 active employees at June 30, 2012 and increasing our variable compensation (bonus) accrual based on performance improvements.

Stock-based compensation totaled approximately totaled approximately $1.6 million for the three-month period ended June 30, 2013 as compared to approximately $1.2 million for the three-month period ended June 30, 2012 and approximately $2.8 million for the six-month period ended June 30, 2013 as compared to approximately $2.0 million for the six-month period ended June 30, 2012. These increases were due primarily to the expense on restricted stock grants of approximately 606,000 shares granted in the first quarter of 2013. See “Financial Condition, Liquidity, and Capital Resources” for disclosure of additional expenses.

Net Investment Income Before Investment Gains and Losses

Net investment income for the three-month periods ended June 30, 2013 and 2012 totaled approximately $17.6 million and $12.3 million, respectively. Net investment income before income tax expense for the six-month periods ended June 30, 2013 and 2012 totaled approximately $32.6 million and $23.7 million, respectively. The changes are made up of the items described above under “Investment Income” and “Operating Expenses.”

Net Investment Realized Gains and Losses and Unrealized Appreciation and Depreciation

Realized gains or losses are measured by the difference between the net proceeds from the repayment or sale and the cost basis of the investment without regard to unrealized appreciation or depreciation previously recognized, and includes investments charged off during the period, net of recoveries. Net change in unrealized appreciation or depreciation primarily reflects the change in portfolio investment values during the reporting period, including the reversal of previously recorded unrealized appreciation or depreciation when gains or losses are realized.

A summary of realized gains and losses for the three and six-month periods ended June 30, 2013 and 2012 is as follows:

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During the three-month periods ended June 30, 2013 and June 30, 2012, we recognized net realized gains of approximately $2.2 million and approximately $8.3 million, respectively. During the three-months ended June 30, 2013, we recorded gross realized gains of approximately $6.0 million from the sale of investments in seven portfolio companies, including Althea Technologies (approximately $3.8 million) and Insmed, Inc. (approximately $1.4 million). These gains were partially offset by the liquidation of our investments in six portfolio companies of approximately $3.8 million in gross realized losses, including the complete write off of equity in E-Band Communications, Corp. that had a cost basis of approximately $3.3 million.

During the six-month periods ended June 30, 2013 and June 30, 2012, we recognized net realized gains of approximately $4.2 million and $11.1 million, respectively. During the six-month period ended June 30, 2013, we recorded additional gross realized gains of approximately $3.7 million from the sale of investments in three portfolio companies. These gains were partially offset by the liquidation of our investments in five portfolio companies of approximately $1.6 million in gross realized losses.

The net unrealized appreciation and depreciation of our investments is based on fair value of each investment determined in good faith by our Board of Directors. The following table itemizes the change in net unrealized appreciation/depreciation of investments for the three and six-month periods ended June 30, 2013 and 2012:

During the three-months ended June 30, 2013, we recorded approximately $755,000 of net unrealized appreciation from our debt, equity and warrant investments. Approximately $5.6 million is attributed to net unrealized appreciation on equity, of which approximately $72,000 is due to the reversal of prior period net unrealized appreciation upon being realized as a gain and $3.3 million is due to the reversal of prior period net unrealized depreciation upon being realized as a loss. Approximately $330,000 is attributed to net unrealized appreciation on our warrant investments, of which approximately $4.8 million is due to the reversal of prior period net unrealized appreciation upon being realized as a gain and $940,000 is due to the reversal of prior period net unrealized depreciation upon being realized as a loss. We recorded approximately $5.1 million of net unrealized depreciation on our debt investments, $4.1 million related to decreases in fair value adjustments made as a result of an increase in interest rates reflected in our current quarter effective yield.

During the three-month period ended June 30, 2013, net unrealized investment appreciation recognized by us was decreased by approximately $83,000 as a result of appreciation during the three-month period ended June 30, 2013 of fair value on the pool of warrants collateralized under the warrant participation agreement.

During the three month period ended June 30, 2012, we recorded approximately $20.5 million of net unrealized depreciation from our loans, warrant and equity investments. Approximately $5.0 million and

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$5.8 million is attributed to net unrealized depreciation on equity and warrants, respectively, of which approximately $5.2 million and $1.7 million is due to the reversal of prior period net unrealized appreciation upon being realized as a gain. Additionally, we recorded approximately $500,000 of unrealized depreciation attributed to reduced expectations of escrow proceeds previously anticipated to be collected.

During the three-month period ended June 30, 2012, we recorded approximately $9.2 million net unrealized depreciation on our debt investments related to decreases in fair value adjustments made as a result of an increase in current quarter effective yield.

The following table itemizes the change in net unrealized appreciation/(depreciation) in the investment portfolio by category for the three-month periods ended June 30, 2013 and 2012.