This really depends on the percentage and workload. Getting paid in percentage is overall more risky then paid by hour - if you want more profit, you must assume greater risk.
A bigger company will give you the option for percentage either to reduce their risk and their variable costs or most likely as the percentage model (%-model) would just cost less.
A smaller company or, for example, entrepreneurs which don't have much capital, mostly have to use things like participating interests models (including a %-model) as it reduces costs if f.e. the product doesn't sell as anticipated. However if the product sells well, there is a good chance of making a lot of profit and much more compared to if you would have been paid per hour.
Another factor to consider is the overall workload. If you would have to do a lot of work at the beginning and would have less to do over the product cycle, lifetime percentage is always a good choice. See this simple example:
Hourly Rate: $25/hr
Percentage Rate: 10% on earnings
| | Y1 | Y2 | Y3 | Y4 | Y5 |
| Workload | 500h | 400h | 100h | | |
| Company Earnings | $30k | $150k | $100k | $50k | $50k |
= (500 + 400 + 100) * 25
= (30000 * 0.1) + (150000 * 0.1) + (100000 * 0.1) + ...
Given this simple example, you would end up with an additional $13,000. However, the main purpose of this exercise is to show that if you have a smaller workload and higher earnings later (especially long term) where you don't have work anymore, it's definitely worth taking the risk.
In conclusion, the %-model gives you the opportunity to earn more money compared to an hourly model, but it also has the potential to earn less instead. If you understand the business and its risks, it'd be worth opting for the %-model. As you said, you're working at the design, so this could be a good opportunity.
If you want to charge upfront as a basis, its totally up to you and your business partner. In Germany, it's not an unusual proposition.
As a personal tip, do take care of the legal part! Most business partners try to pull you out as soon they see that their %-model plan costs them too much. Do long-term contracts, not based on years. I've seen this dozens of times.