Well it happened to myself and a friend of mine with the same stick and seems to be a build of static that causes the problem.
While playing SF4 on the PS4 the stick would just lose its connection and I’d have to slide the PS3/PS4 switch to PS3 and back again, then push the PS button to reconnect it.
No good in the middle of a online match as you can imagine.
With some testing and research it seems as though because the stick has a metal base and a plastic faceplate it is very susceptible to static build up which causes the stick to cut out.
I lasercut myself a wooden faceplate and put rubber grip on the base which prevents static build up and my stick does not cut out anymore.
A friend of mine who bought the same stick because of its low price (Its an awesome stick by the way, perfect for modding) had the exact same problem so I lasercut him a faceplate and supplied some left over grip and its seemed to have fixed his too. We both tested his the other night and it didn’t cut out at all, whereas before the mod it cut out quite a few times.
We may be the only two people in the world who has had this problem with the Venom Arcade Stick but heres this post just in case.
It worked for me but I cant guarantee it will work 100% for anyone else having this problem, Im positive it helps though.
UPDATE 12/2/16 - keep reading further posts, sounds like soldering a wire from baseplate to one of the button wires grounds the electrics.
Easier than replacing faceplate and adding grip.