Set the instant pot to the sauté setting and add olive oil.
Add the short ribs and brown all sides. It probably will take about 10 minutes. Then, remove the shot ribs from the Instant Pot and set aside.
Add in onion and garlic. Sauté until onion is translucent. It's about 4 minutes. Don’t forget to scrap the browned bits from the bottom of the pot.
Add thyme, tomato paste and balsamic vinegar. Stir everything very well. Then, season with salt and pepper.
Turn off the sauté mode. Add in beef broth and bay leaves. Stir well. Transfer the short ribs back to the pot.
Lock the lid and set pressure on high for 1 hour. When done, use Natural Release for 10 minutes, then release valve and remove the lid.
Remove shot ribs carefully, keeping the meat on the bone.
Pour about 1/4 cup of the cooking liquid into a small bowl. Add cornstarch and stir it very well. Set aside.
Pour all the cooking liquid from the Instant Pot into a saucepan and heat on a high heat.
Slowly pour the cornstarch mixture into the saucepan with the cooking liquid and whisk for about 2 minutes or until gravy thickens. Season with salt and pepper if you desire.
Place short ribs on serving plate, spoon over sauce. Enjoy!