Heat a large cast iron or non-stick skillet to medium-high heat. Add 1-2 pounds mushrooms directly to the pan without oil or butter. As the mushrooms begin to release their natural liquids, add about ½ teaspoon of salt to help the moisture continue to release. Stir occasionally until mushrooms become browned to your liking. You shouldn't need to add any butter or oil to the pan but if you like, you can add about a teaspoon during browning. Remove mushrooms from heat and set aside.
Turn the Instant Pot to Sauté and add 1 Tablespoon olive oil and 2 chopped shallots. Stir frequently until shallots begin to slighly caramalize, about 3 minutes.
Add 1 ½ cups Arborio rice and stir to coat with the oil that's already in the pan. Add ½ cup white wine or a combination of water and white vinegar. Stir and cook until the wine has almost completely evaporated. This takes less than a minute.
Add 4 cups vegetable broth to the rice mixture and stir briefly, making sure the rice is submerged.
Place the lid on the Instant Pot, turn steam release nozzle to Seal. Using Manual button and High Pressure, set time for 5 minutes. Pot will take about 3-4 minutes to reach desired pressure before starting to count down the 5 minutes. Once the cooking has completed and the Instant Pot beeps, let pressure release naturally for 4 minutes before turning nozzle to Vent to finish releasing the steam.
Remove lid from Instant Pot. Add 1 teaspoon salt, ½ cup Parmesan cheese, 4 Tablespoons butter, and the sautéed mushrooms. Stir until butter and cheese have melted. Add 1 Tablespoon fresh chopped parsley. Stir again. Taste and add fresh ground black pepper and additional salt to your liking. The rice should be perfectly al dente.
Serve immediately with extra Parmesan cheese, if desired.