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The strengths of Venice are 3 state cultures (italian, greek and slavonic) that allow it to have many state-culture provinces. Venice also gets high starting trade and infrastructure technology, and a rich center of trade.

The strategy for Venice must take into account its powerful enemies. In the early game these will be the Ottoman Empire and Austria. Later it is OE, Austria and France. Because of that, diplomatic skills for Venice are important so the first DP slider that should be moved is maximum aristocracy.

OE: it is a very good idea to take Thrace(Constantinople) before OE and then protect it. The reason is the event for OE after conquering Thrace that changes culture and religion of several provinces from Greek and Orthodox, which you can work with, to Turkish and Sunni. This significantly strengthens OE and makes those provinces (especially very rich Thrace) much less useful to Venice.

Austria: Austria is relatively weak early in the game and strengthens a lot in 1526-1540 when it usually inherits Bohemia and Hungary. In addition sometimes it inherits Burgundy, Milano and Spain. So the strategy for Venice is to act before these events. Build a coalition and vassalize Austria (possibly taking Steiermark with the gold mine). Then - just before those events hit - attack and conquer Bohemia/Hungary but do not make peace - wait for inheritance. Provinces obtained this way cost no badboy for you, while Austria still gets the 0.25 badboy even though you get the provinces.