For most people, one of the best ways to invest in a tax-advantaged manner is through an individual retirement account (IRA). There a few different types, but the catch with all of them is that you can't withdraw funds from them without incurring a penalty until your age hits 59 and a half. That shouldn't really be an issue when you are investing with a long time horizon.

If you're looking for appropriate investments that you can hold in an IRA for decades, three great conglomerates to consider are Constellation Software (TSX:CSU), InterActiveCorp (NASDAQ:IAC), and Boston Omaha (NASDAQ:BOMN). Let's find out a bit more about these companies and why they make good IRA investments.

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1. Constellation Software

Founded in 1995 by former venture capitalist Mark Leonard, Constellation Software has been one of the best-performing stocks of the past 15 years. Since its IPO in 2006, its share price has gone up by more than 14,000%, trouncing the broader market. Why has Constellation been so successful, and what makes it such a rock-solid investment? The company is a conglomerate of hundreds of vertical market software (VMS) companies of all sizes and in all sorts of industries.

VMS products are designed to fill specific needs of companies in narrow niches, in contrast to horizontal market software products like Microsoft Excel, which fill more general needs. Since its early days, Constellation has been steadily acquiring other VMS companies and using the excess cash they generate to buy still more of them. Its disciplined underwriting process has allowed it to grow its free cash flow at a high rate for many years.

Over the past 12 months, Constellation's consolidated free cash flow was $1.3 billion. At its current market cap of $32.7 billion, that gives it a price-to-free-cash-flow (P/FCF) ratio of 25. With a strong track record of success, a proven playbook, and plenty of acquisition opportunities out there (it is estimated that there are over 100,000 software companies in the world, and Constellation owns less than 1,000), Constellation looks like a great long-term holding for anyone's portfolio.

2. InterActiveCorp (IAC)

IAC's focus is on consumer internet companies. It started in 1995 with now Chairman Barry Diller as CEO, and has since acquired and spun off many companies, among them Expedia (NASDAQ:EXPE), Match Group (NASDAQ:MTCH), and most recently Vimeo (NASDAQ:VMEO)

IAC currently has a more than $5 billion majority stake in Angi  (NASDAQ:ANGI), a $2.45 billion stake in MGM Resorts (NYSE:MGM), and $2.8 billion in cash. It also owns a bunch of smaller companies like the online publisher DotDash, the family care website Care.com, and Ask.com. These assets are currently being valued by the market at $2.28 billion, and they generated $1.4 billion in trailing 12-month revenue.

The investment thesis for IAC isn't based on one company's success but on a group of companies trading at a discounted valuation -- its current market cap is $12.8 billion. If the team Diller has assembled can continue building successful consumer internet companies, IAC should prove a rewarding holding for IRA investors. 

3. Boston Omaha

Since Boston Omaha started in 2015, co-CEOs Alex Rozek and Adam Peterson have bought a number of whole businesses and taken minority interests in others with the broad goal of growing long-term intrinsic value per share. Its largest fully-owned subsidiaries are in the billboard, surety insurance, and broadband businesses. Over the last 12 months, these operations generated around $47.5 million in sales for Boston Omaha. Within the billboards and insurance segments, revenues were depressed due to the COVID-19 pandemic, so investors should expect its consolidated results to pick up over the next year or two.

Outside of these wholly-owned businesses, the company owns a stake valued at around $100 million in Dream Finders Homes (NASDAQ:DFH), a sponsor for a special purpose acquisition company (SPAC). It also owns a 15% stake in subprime auto lender CB&T Corp.

As with the other two conglomerates discussed here, an investment in Boston Omaha is a bet on management's ability to do well by shareholders. It has less of a track record than IAC and Constellation Software, making it a bit riskier, but with a market cap under $1 billion, it has a lot of upside potential -- especially for investors who plan on holding its shares for a decade or two.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.