Preheat oven to 325°F. Pat beef pieces completely dry with paper towels and season generously with salt and pepper on all sides.

In a large Dutch oven, cook chopped bacon over medium heat until crispy, about 5 minutes. Remove bacon with a slotted spoon and set aside, leaving rendered fat in pot.

Working in batches to avoid overcrowding, brown beef pieces on all sides in the bacon fat, about 8-10 minutes total per batch. Transfer browned beef to a plate.

Add diced onion and carrots to the pot and cook until softened, about 5 minutes. Add minced garlic and cook for 1 minute until fragrant.

Stir in tomato paste and cook for 1 minute. Sprinkle flour over vegetables and stir to combine, cooking for 2 minutes.

Slowly pour in red wine, scraping up any browned bits from the bottom of the pot. Add beef broth, bay leaves, and thyme sprigs.

Return beef and bacon to the pot. Bring to a simmer, then cover and transfer to preheated oven.

Braise for 1.5 hours, then add pearl onions and continue cooking for 30 more minutes.

Meanwhile, heat olive oil in a large skillet over medium-high heat. Sauté quartered mushrooms until golden brown, about 6-8 minutes.

Add seared mushrooms to the pot and continue cooking for 15-20 minutes until beef is fork-tender.

Remove bay leaves and thyme stems. Taste and adjust seasoning with salt and pepper as needed.

Serve hot, garnished with fresh chopped parsley. Pair with mashed potatoes, crusty bread, or egg noodles.