Against the backdrop of rapid industrial evolution and institutional change in emerging industries, business model innovation in new ventures must address conformity requirements from institutional norms and market cognition while building distinctive competitive advantages through innovation. However, there has been insufficient explanation on how new ventures promote the dynamic evolution of business model innovation under conformity–distinctiveness tensions. Drawing on the optimal distinctiveness theory, this paper conducts a longitudinal single-case study of Li Auto to examine the dynamic evolution mechanism of business model innovation in new ventures. The results show that business model innovation is not a simple accumulation of innovation activities, but a staged transition achieved through the orchestration of dual legitimacy and ambidextrous innovation as industrial contextual challenges change. Specifically, in the start-up stage, structural challenges lead to threshold orchestration between constructive dual legitimacy and combined ambidextrous innovation, resulting in adaptive business model innovation; in the expansion stage, cognitive challenges lead to compensatory orchestration between restorative dual legitimacy and balanced ambidextrous innovation, resulting in focused business model innovation; in the transformation stage, systemic challenges lead to integrative orchestration between reconstructive dual legitimacy and synergistic ambidextrous innovation, resulting in complex business model innovation. This paper reveals the dynamic realization of optimal distinctiveness from threshold orchestration to compensatory and integrative orchestration, and offers a new explanation of the linkage among dual legitimacy, ambidextrous innovation, and business model innovation in new ventures.