Prepare Bacon and Beef: Fry bacon until crisp, set aside. Brown beef in batches in bacon fat for a rich crust. Season with salt and pepper.
Cook Vegetables: Sauté onions and carrots in the same pot until lightly browned.
Combine Ingredients: Return beef and bacon to the pot. Sprinkle with flour, toss to coat, and lightly brown in the oven for 4 minutes at 230°C (450°F).
Simmer Stew: Add stock, tomato paste, garlic, thyme, and bay leaf. Simmer on the stove or oven (160°C/325°F) for 3–4 hours until beef is tender.
Prepare Mushrooms and Onions: Sauté mushrooms and pearl onions in butter. Add them to the stew in the final 30 minutes of cooking.