Add beans and water to instant pot. Cook on manual (high pressure) for 25 minutes. Allow the pressure to naturally release.
Remove lid and pour beans into a colander/strainer. Rinse with cold water.
Set Instant Pot to sauté setting. Add bacon and sauté for a few minutes until it starts to get golden brown, tossing and scraping down the bottom of the pot often. Draining the grease.
Add bell pepper and onion and cook until tender.
Turn Instant Pot off. Add BBQ sauce, ketchup, mustard, vinegar and liquid smoke to the pot and stir well to combine.
Add brown sugar, water and beans and stir to combine.
Secure the lid, close steam valve and cook on Manual (high pressure) for 15 minutes. Natural release the pressure.
Carefully open lid, and gently stir mixture to combine. Enjoy!