Pat the beef cubes completely dry with paper towels. Season them lightly with salt and pepper. Dry beef browns better, so do not skip this simple preparation step.

Place the bacon in a large Dutch oven over medium heat. Cook until browned and crisp. Remove the bacon with a slotted spoon, leaving the flavorful fat inside the pot.

Add olive oil if needed. Brown the beef pieces in small batches. Leave space between each piece. Turn them carefully until every side develops a deep golden-brown crust.

Add sliced onions and carrots to the same pot. Cook for several minutes until they begin softening. Add garlic and cook briefly until fragrant without allowing it to burn.

Return the browned beef and bacon to the pot. Sprinkle flour over everything and stir gently. Cook for about two minutes to remove the raw flour taste.

Pour in the red wine and scrape the browned bits from the bottom. Add beef stock and tomato paste. Stir until the liquid becomes evenly mixed around the beef.

Add thyme, bay leaves, salt, and black pepper. Bring the liquid to a gentle simmer. Avoid a rapid boil because slow cooking helps keep the beef tender.

Cover the Dutch oven and place it in a preheated 325°F oven. Cook for about two and a half hours. Check occasionally and stir gently when needed.

Melt butter in a skillet over medium heat. Add mushrooms and pearl onions. Cook until lightly browned and tender. Set them aside while the beef continues cooking.

Remove the Dutch oven from the oven when the beef is fork-tender. Discard the bay leaves. Stir in the cooked mushrooms and pearl onions, then garnish with fresh parsley.