Heat olive oil over medium high heat. Add 1/2 of the onions and saute until translucent and slightly browned. Add garlic and stir constantly for 1 minute. Add beef and sausage and cook until no red remains. Drain excess fat off of the cooked meat and return to the pan
Place the remaining onions and red pepper in a blender or food processor and blend until mostly smooth. Add mixture to the garlic, onions and beef and stir to combine, cooking for another minute. Add tomato paste and spices and cook for 1 minute, stirring until combined. Add tomatoes, beef broth, sugar and mushrooms. Stir until combined and add the bay leaves and balsamic vinegar.
Bring to a boil and then reduce to low and simmer for 1 hour up to 3-4. The longer it simmers, the more flavorful it will get. The sauce will seem watery at first, but as it simmers it will thicken.