Heat a large (best size is 5 Q/L) dutch oven over medium-high heat. Add butter and oil. When butter stops foaming, add the beef and brown on all sides. Remove to a plate.
In the same dutch oven, add the mushrooms and cook until they begin to brown.
Deglaze the pan with the Madeira. Add the beef back to the pot along with the bay leaf, thyme, salt and pepper. Bring to a boil, reduce heat to simmer, cover and cook for 1 1/2-2 hours or until beef is tender.
While beef is simmering, prepare browned onions per this method (but do NOT add the cream). When onions are browned, set aside.
If you want a thickened gravy, combine the flour and water making sure there are no lumps. Add to the pan, stirring until thickened. Cook for 5 more minutes.
Add the onions to the pan and heat through. Remove bay leaf and thyme sprigs (if fresh was used) before serving.