The labels, are, in effect, lending the money the band needs to start and promote itself. If you give me 100K today and I give you back 100K three years from now, I won't expect you to think we are even.
However if I gave you 100K today to start a company with the condition that I get 60% of every sale you make plus you still have to pay me back the 100K out of your 40%, then it is certainly possible for me to make out very well from the deal even if you never actually manage to pay me back the full loan. At what point we are considered "even" is of course up for debate.
The $100K are used to promote the product, so it is just an investment for the label -- which may be eventually fully paid from the band's money. It looks like a sweet deal to me.
