Step 1 Season the chicken livers with salt and pepper on each side. Heat a large saute pan over high heat for 2 minutes. Swirl the olive oil into the pan and wait another minute. Place the livers in the pan without crowding them (you may have to do this in batches). Sear the livers on the first side for a minute or two until they are nicely caramelized. Turn them over and cook 1 more minute, until they are just medium rare. Transfer them to a platter or baking sheet.
Step 2 Return the pan to the stove, lower the heat to medium and add the pancetta. Cook about 2 to 4 minutes, stirring often until the pancetta is just starting to become crisp.
Step 3Add the onion and thyme, season with salt and pepper and cook an extra 2 to 3 minutes, until the pancetta is crispy but still tender and the onion is translucent and just starting to color. Transfer the onion and pancetta to a platter or baking sheet to cool.
Step 4Chop one-third of the livers and add them to a large bowl with one-third of the onion. Place the rest of the onion, pancetta and liver in the bowl of a food processor.
Step 5Return the pan to the stove over low heat and add the balsamic vinegar. Reduce the vinegar to a glaze, about 1 to 2 minutes, and then pour it into the food processor, using a rubber spatula to scrape all of it in. Puree the livers and then add the butter little by little, pulsing all the time until the butter is completely incorporated.
Step 6Transfer the puree to the large bowl and fold in the chopped liver and remaining onion and pancetta. Test for seasoning and adjust with salt, pepper and the sherry vinegar, if using. Makes about 1 1/4 cups.