Slice the beef into 1/2-inch slices against the grain. Place them in a nonreactive bowl.
Sprinkle the sugar over the beef and toss to coat evenly. Allow it to sit for 10 minutes.
In the bowl of a food processor fitted with the metal blade, combine the shallots, vinegar, soy sauce, lime juice, oil and garlic. Blend to form a smooth mixture. Pour over the beef. Let it marinate, covered, for 1 to 2 hours.
Soak 24 bamboo skewers in water for 30 minutes. Drain.
Preheat a grill to medium-high heat.
Drain the beef and discard the marinade. Thread the beef onto the skewers. Grill for 5 to 6 minutes, until browned, turning once. Do not overcook. Serve with the dipping sauce.
To make sauce: Blend all ingredients together in the bowl of a food processor. Serve with beef satay.
Serves 8 to 10.